3.1 Financial Information

3.1.1 Financial Highlights

The financial highlights presented within the Agency's Performance Report are intended to serve as a general overview of the CFIA's financial position and operations. Financial statements are prepared in accordance with accrual accounting principles, Treasury Board accounting policies and year-end instructions issued by the Office of the Comptroller General which are based on Canadian generally accepted accounting principles for the public sector as required under Section 31 of the Canadian Food Inspection Agency Act. The Agency has been audited since its creation and has always received an unqualified opinion from the Office of the Auditor General of Canada.

The main highlights for 2011-2012 are the application of the new Treasury Board Accounting Standard 1.2 – Departmental and Agency Financial Statements, the Shared Services Canada expenses presented as services received without charge, the recording of a work force adjustment liability, the change in the accounting of the Agency's respendable revenues, the change in the program architecture and the inclusion of the planned results in the Statement of Operations and Agency Net Financial Position.

(In thousands of dollars)

Condensed Statement of Financial Position As at March 31

% Change

2012

2011

Total net liabilities

5.50%

233,510

221,338

Total net financial assets

-34.54%

53,605

81,890

Agency - net debt

29.01%

179,905

139,448

Total non-financial assets

-12.06%

206,767

235,115

Agency - net financial position

-71.92%

26,862

95,667

(In thousands of dollars)

Condensed Statement of Operations and Agency Net Financial Position Year ended March 31

% Change

2012

2011

Total expenses

5.42%

884,525

839,040

Total revenues

2.71%

57,560

56,041

Net cost of operations

5.62%

826,965

782,999

Net cost of operations after government funding and transfers

68,805

(10,777)

Agency - net financial position - Beginning of year

-12.70%

95,667

84,890

Agency - net financial position

-71.92%

26,862

95,667

Description for Pie Chart - Assets by Type

Tangible Assets

Due from CRF

Accounts Receivable

Inventory

Prepaid expenses

78.54%

18.01%

2.68%

0.38%

0.38%

The total net financial assets of $54 million represent a decrease of $28 million (35%), which is mainly the result of a decrease in the amount of Due from the Consolidated Revenue Fund ($28 million) resulting from the 2012 budget restraints. The non-financial assets also decreased by $28 million (12%) from $235 million to $207 million. This is a result of a decrease in the net book value of tangible capital assets as the amortization was more significant compare to the new acquisitions for 2012. Tangible capital assets represented the largest portion of the total assets, at $205 million (79%), while Due from CRF represented 18% at $47 million. Accounts receivable and advances only represented 3%, followed by the inventory and prepaid expenses which represented less than 1% of total assets.

Description for Pie Chart - Liabilities by Type

Employee severance benefits

Accounts payable

Vacation Pay

Deferred revenue

52.14%

33.33%

13.68%

0.85%

Total net liabilities at the end of 2011-2012 were $234 million, an increase of $13 million (6%) over the previous year's total net liabilities of $221 million. The $13 million increase is mostly explained by an increase in employee severance benefits ($16 million) resulting from a higher rate provided by the Office of the Chief Actuary. Employee severance benefits represented 52% of total net liabilities, at $122 million, followed by the accounts payable and accrued liabilities which represented 33 % of total net liabilities, at $78 million. Vacation pay and compensatory leave represented $32 million (14%), while deferred revenue represented less than 1% of total net liabilities.

Description for Pie Chart - Expenses by Program Activities

Expenses by Program Activities

Food Safety Program

Animal Health and Zoonotics Program

Plant Resources Program

International Collaboration and Technical Agreements

Internal Services

45.54%

19.32%

11.75%

4.86%

18.53%

The Agency's total expenses were $885 million in 2011-2012, an increase of $46 million ( 5%) compare to last year. The significant increases come from the costs recorded for the workforce adjustment resulting from the deficit reduction action plan ($23 million), the increase in severance benefits expenses ($12 million), greater amortization ($6 million), and higher services received without charges, not including Shared Services Canada expenses ($9 million). The majority of the expenses, $403 million (46%) were under the Food Safety Program. Both the Animal Health and Zoonitics Program as well as the Internal Services formed 19% of total expenses, while the Plant Resources Program represented 12 % at $104 million. Approximately 5% of all expenses were under the International Collaboration and Technical Agreements.

Description for Pie Chart - Revenues by Program Activities

Revenues by Program Activities

Food Safety Program

Animal Health and Zoonotics Program

Plant Resources Program

International Collaboration and Technical Agreements

Internal Services

58.62%

5.17%

12.07%

22.41%

1.72%

The Agency's total revenues amounted to $58 million for 2012-2011. Revenues for 2011-2012 remained fairly consistent with the revenues earned in 2010-2011, with a slight increase of $2 million (3%). The inspection fees forms the biggest portion of the revenues at $43 million, representing 74 % of all revenues. More than half of the revenue was derived from the Food Safety Program, while the International Collaboration and Technical Agreements represented 22% at $13 million. The Plant Resources Program represented 12% of all revenues while the Animal Health and Zoonitics Program represented approximately 5%. Less than 2% of all revenues were derived from Internal Services.

CFIA reported planned results for the fiscal year 2012 in its Financial Statements. Those figures are taken from the 2011–2012 Future-Oriented Statement of Operations.

The total expenses planned were $817 million versus actual expenses of $885 million for a variance of $68 million. That variance is explained by a difference ($19 million) between the appropriation available forecasted ($719 million) versus the actual appropriation used ($738 million). That difference is mostly explained by $8 million more in capital votes than expected, $3 million more in statutory contributions to the employee benefits plans and $5 million more in compensation payments than expected. Given the nature of the Agency's compensation payments, the forecasted amount is established at $1.5 million automatically. In addition, as a result of the recent announcement related to the deficit reduction action plan by the Government, the Agency recorded a liability of $23 million for workforce adjustment costs. The amortization also came in higher than expected at $38 million versus the original estimate of $29 million. That difference of $9 million is explained by a significant increase of assets under construction completed during the fiscal years 2011 and 2012, which increased significantly the amortization for the 2012 fiscal year. The remaining of the variance ($14 million) is mostly explained by the revision of the employee severance benefits allowance following an adjustment to the rates used in the calculation of this liability.

The Agency's inspection fees have increased following reinforcements surrounding the completeness of revenue therefore resulting in the $5 million difference seen between the original forecast and the actual revenues for 2012.

To the President of the Canadian Food Inspection Agency and the Minister of Agriculture and Agri-Food

Report on the Financial Statements

I have audited the accompaning financial statements of the Canadian Food Inspection Agency, which comprise the statement of financial position as at 31 March 2012, and the statement of operations and agency net financial position, statement of change in agency net debt and statement of cash flows for the year then ended, and a summary of significant accounting policies and explanatory information.

Management's Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with Canadian public sector accounting standards, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

My responsibility is to express an opinion on these financial statements based on my audit. I conducted my audit in accordance with Canadian generally accepted auditing standards. Those standards require that I comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion.

In my opinion, the financial statements present fairly, in all material respects, the financial position of the Canadian Food Inspection Agency as at 31 March 2012, and the results of its operations and its cash flows for the year then ended in accordance with Canadian public sector accounting standards.

Dale Shier, CA Principle for the Auditor General of Canada

21 September 2012 Ottawa, Canada

Description of Financial - Financial Statements Page 1

Financial Statements of Canadian Food Inspection Agency

Year ended March 31, 2012

Description of Financial - Financial Statements Page 2

Statement of Management Responsibility Including Internal Control Over Financial Reporting (Unaudited)

Responsibility for the integrity and objectivity of the accompanying financial statements for the year ended March 31, 2012 and all information contained in these statements rests with the Agency's management. These financial statements have been prepared by management using the Government's accounting policies, which are based on Canadian public sector accounting standards.

Management is responsible for the integrity and objectivity of the information in these financial statements. Some of the information in the financial statements is based on management's best estimates and judgment, and gives due consideration to materiality. To fulfill its accounting and reporting responsibilities, management maintains a set of accounts that provides a centralized record of the Agency's financial transactions. Financial information submitted to the Public Accounts of Canada and included in the Agency's Departmental Performance Report is consistent with these financial statements.

Management is also responsible for maintaining an effective system of internal control over financial reporting (ICFR) designed to provide reasonable assurance that financial information is reliable, that assets are safeguarded and that transactions are properly authorized and recorded in accordance with the Financial Administration Act and other applicable legislation, regulations, authorities and policies.

Management seeks to ensure the objectivity and integrity of data in its financial statements through careful selection, training and development of qualified staff; through organizational arrangements that provide appropriate divisions of responsibility; through communication programs aimed at ensuring that regulations, policies, standards, and managerial authorities are understood throughout the Agency and through conducting an annual risk-based assessment of the effectiveness of the system of ICFR.

The system of ICFR is designed to mitigate risks to a reasonable level based on an on-going process to identify key risks, to assess effectiveness of associated key controls, and to make any necessary adjustments.

A risk-based assessment of the system of ICFR for the year ended March 31, 2012 was completed in accordance with the Treasury Board Policy on Internal Control and the results and action plans are summarized in the annex.

The Departmental Audit Committee is responsible for providing the President with independent, objective advice and guidance in relation to the adequacy of the Agency's control and accountability processes. The Departmental Audit Committee provides this support through oversight of core areas of the Agency's controls and accountabilities, including values and ethics, risk management, management control framework, internal audit functions, and accountability reporting.

Description of Financial - Financial Statements Page 3

Statement of Management Responsibility Including Internal Control Over Financial Reporting (Unaudited)

The financial statements of the Agency have been audited by the Auditor General of Canada, the independent auditor for the Government of Canada which does not include an audit opinion on the statement of management responsibility including internal control over financial reporting and annual assessment of the effectiveness of the department's internal controls over financial reporting.

George Da Pont President

Peter Everson Vice-President, Corporate Management Branch

Ottawa, Canada September 21, 2012

Description of Financial - Financial Statements Page 4

Statement of Financial Position

As at March 31 (In thousands of dollars)

2012

2011 Restated (Note 2)

Liabilities

Accounts payable and accrued liabilities (Note 5)

$ 78,125

$ 81,653

Vacation pay and compensatory leave

31,593

31,407

Deferred revenue

2,024

2,242

Employee severance benefits (Note 6 (b))

121,773

106,036

Total gross liabilities

233,515

221,338

Deferred revenue held on behalf of Government

(5)

-

Total net liabilities

233,510

221,338

Financial Assets

Due from Consolidated Revenue Fund

46,524

73,809

Accounts receivable and advances (Note 7)

8,062

8,927

Total gross financial assets

54,586

82,736

Accounts receivable and advances held on behalf of Government (Note 7)

(981)

(846)

Total net financial assets

53,605

81,890

Agency - net debt

179,905

139,448

Non-Financial assets

Prepaid expenses

1,161

1,168

Inventory

1,048

1,013

Tangible capital assets (Note 8)

204,558

232,934

Total non-financial assets

206,767

235,115

Agency - net financial position

$ 26,862

$ 95,667

Contingent liabilities (Note 9) Contractual obligations (Note 10)

The accompanying notes are an integral part of these financial statements.

George Da Pont President

Peter Everson Vice-President, Corporate Management Branch

Ottawa, Canada September 21, 2012

Description of Financial - Financial Statements Page 5

Statement of Operations and Agency Net Financial Position

Year ended March 31 (In thousands of dollars)

2012 Planned Results

2012

2011 Restated (Note 2)

Expenses

Food Safety Program

$ 370,294

$ 402,503

$ 384,455

Animal Health and Zoonotics Program

149,686

170,987

167,285

Plant Resources Program

96,714

103,993

97,967

International Collaboration and Technical Agreements

50,231

42,965

39,362

Internal Services

149,662

164,080

149,974

Expenses incurred on behalf of Government

-

(3)

(3)

Total expenses

816,587

884,525

839,040

Revenues

Inspection fees

37,492

43,088

40,625

Registrations, permits, certificates

9,433

8,478

9,027

Miscellaneous fees and services

3,726

3,959

4,405

Establishment license fees

1,724

1,888

1,788

Administrative monetary penalties

537

837

501

Grading

203

211

200

Interest

46

44

24

Revenues earned on behalf of Government

(583)

(945)

(529)

Total revenues

52,578

57,560

56,041

Net cost of operations

764,009

826,965

782,999

Government funding and transfers

Net Cash provided by government

705,399

715,867

Change in due from Consolidated Revenue Fund

(27,285)

5,582

Services provided without charge by other government departments (Note 11)

82,764

65,821

Assets funded by other government departments (OGD)

138

303

Transfer of assets and liabilities from/to OGD (Note 12)

(2,856)

6,203

Net cost of operations after government funding and transfers

68,805

(10,777)\

Agency - net financial position - Beginning of year

95,667

84,890

Agency - net financial position - End of year

$ 26,862

$ 95,667

Segmented information (Note 13) The accompanying notes are an integral part of these financial statements.

Description of Financial - Financial Statements Page 6

Statement of Change in Agency Net Debt

Year ended March 31 (In thousands of dollars)

2012

2011

Net cost of operations after government funding and transfers

$ 68,805

$ (10,777)

Change in tangible capital assets

Acquisition of tangible capital assets

14,277

50,065

Amortization of tangible capital assets

(37,640)

(31,550)

Proceeds from disposal of tangible capital assets

(119)

(218)

Loss on disposal of tangible capital assets

(113)

(543)

Post-capitalization of tangible capital assets

47

818

Transfer from/to low value assets

-

(87)

Tangible capital assets funded by other government departments (OGD)

91

200

Tangible capital assets transfer to OGD (Note 12)

(4,919)

6,203

Total change due to tangible capital assets

(28,376)

24,888

Change in inventories

35

(158)

Change in prepaid expenses

(7)

706

Net increase in Agency net debt

40,457

14,659

Agency - net debt - Beginning of year

139,448

124,789

Agency - net debt - End of year

$ 179,905

$ 139,448

The accompanying notes are an integral part of these financial statements.

Description of Financial - Financial Statements Page 7

Statement of Cash Flows

Year ended March 31 (In thousands of dollars)

2012

2011 Restated (Note 2)

Operating activities

Cash received from:

Fees, permits and certificates

$ (60,240)

$ (56,864)

Cash paid for:

Salaries and employees benefits

611,756

581,369

Operating and maintenance

137,415

136,677

Transfer payments

3,086

5,096

Revenues collected on behalf of Government

(776)

(258)

Cash used by operating activities

691,241

666,020

Capital investment activities

Acquisition of tangible capital assets

14,277

50,065

Proceeds from disposal of tangible capital assets

(119)

(218)

Cash used by capital investment activities

14,158

49,847

Net cash provided by Government of Canada

$ 705,399

$ 715,867

The accompanying notes are an integral part of these financial statements.

Description of Financial - Financial Statements Page 8

1. Authority and Purposes

The Canadian Food Inspection Agency (the "Agency") was established, effective April 1, 1997, under the Canadian Food Inspection Agency Act. The Act consolidates all federally mandated food and fish inspection services and federal animal and plant health activities into a single agency.

The Agency is a departmental corporation named in Schedule II to the Financial Administration Act and reports to Parliament through the Minister of Agriculture and Agri-Food.

The mandate of the Agency is to enhance the effectiveness and efficiency of federal inspection and related services for food, animals and plants. The objectives of the Agency are to contribute to a safe food supply and accurate product information; to contribute to the continuing health of animals and plants; and to facilitate trade in food, animals, plants, and related products.

In delivering its mandate, the Agency operates under the following 4 program activities supported by internal services:

(a) Food Safety Program: The Food Safety Program aims to mitigate risks to public health associated with diseases and other health hazards in the food supply system and to manage food safety emergencies and incidents. The program achieves its objectives by promoting food safety awareness through public engagement and verification of compliance by industry with standards and science-based regulations. The program delivers initiatives to verify that consumers receive food safety and nutrition information and to mitigate unfair market practices targeting consumers and industry. Collaboration with other governments and stakeholders further enhances the Agency's ability to track, detect and mitigate risks associated with food and the food supply system, including food-borne illness. This program supports public health and instils confidence in Canada's food system.

(b) Animal Health And Zoonotics Program: The Animal Health and Zoonotics Program aims to mitigate risks to Canada's animal resource base, animal feeds and animal products, which are integral to a safe and accessible food supply system as well as to public health. The program achieves its objectives by mitigating risks to Canada's animals (including livestock and aquatic animals) from regulated diseases, managing animal disease emergencies and incidents, mitigating and managing risks to livestock and derived food products associated with feed, promoting animal welfare and guarding against deliberate threats to the animal resource base. The program helps to mitigate risks associated with animal diseases that can be transmitted to humans by controlling diseases within animal populations. This program supports the health of Canada's animal resources and instils confidence in the safety of Canada's animals, animal products and by-products, and production systems.

(c) Plant Resources Program: The Plant Resources Program aims to mitigate risks to Canada's plant resource base, which is integral to a safe and accessible food supply, as well as to public health and environmental sustainability.

Description of Financial - Financial Statements Page 9

The program achieves its objectives by regulating agricultural and forestry products; mitigating risks to the plant resource base (including crops and forests) from regulated pests and diseases; regulating the safety and integrity of seeds, fertilizers and plant products; and managing plant health emergencies and incidents. The program also guards against deliberate threats to the plant resource base, facilitates the introduction of emerging plant technologies and protects the rights of plant breeders. Achieving the objectives of the program instils confidence in Canada's plants, plant production systems and plant products, and contributes to the health of Canada's plant resources.

(d) International Collaboration And Technical Agreements: The CFIA's International Collaboration and Technical Agreements program contributes to a coherent, predictable, and science-based international regulatory framework that facilitates meeting regulatory requirements of importing countries' food, animals and plants, and their products, resulting in the facilitation of multi-billion dollar trade for the Canadian economy. The program achieves its objectives through actively participating in international fora for the development of international science-based rules, standards, guidelines and policies and, the management of sanitary and phytosanitary committees established under international agreements. The CFIA's active promotion of the Canadian science-based regulatory system with foreign trading partners and negotiations to resolve scientific and technical issues contribute to market access.

(e) Internal Services: Internal Services are groups of related activities and resources that are administered to support the needs of programs and other corporate obligations of an organization.

In addition, the Agency is responsible for enforcement of the Consumer Packaging and Labelling Act and the Food and Drugs Act as they relate to food, except those provisions that relate to public health, safety, or nutrition.

Operating and capital expenditures are funded by the Government of Canada through parliamentary authorities. Compensation payments under the Health of Animals Act and the Plant Protection Act and employee benefits are authorized by separate statutory authorities. Revenues generated by its operations are deposited to the Consolidated Revenue Fund and are available for use by the Agency.

Description of Financial - Financial Statements Page 10

2. Accounting changes

During 2011, amendments were made to Treasury Board Accounting Standard 1.2 - Departmental and Agency Financial Statements to improve financial reporting by government departments and agencies. The amendments are effective for financial reporting of fiscal years ending March 31, 2012, and later. The significant changes to the Agency's financial statements are described below. These changes have been applied retroactively, and comparative information for 2010-11 has been restated.

Net debt (calculated as liabilities less financial assets) is now presented in the Statement of Financial Position. Accompanying this change, the Agency now presents a Statement of Change in Net Debt and no longer presents a Statement of Equity of Canada.

Revenue and related accounts receivable are now presented net of non-respendable amounts in the Statement of Operations and Agency Net Financial Position and Statement of Financial Position. The effect of this change was to increase the net cost of operations after government funding and transfers by $945,000 for 2012 ($529,000 for 2011) and decrease total financial assets by $981,000 for 2012 ($846,000 for 2011).

Government funding and transfers, as well as the credit related to services provided without charge by other government departments, are now recognized in the Statement of Operations and Agency Net Financial Position below "Net cost of operations before government funding and transfers.'' In previous years, the Agency recognized these transactions directly in the Statement of Equity of Canada. The effect of this change was to decrease the net cost of operations after government funding and transfers by $758,160,000 for 2012 ($793,776,000 for 2011).

(In thousands of dollars)

2011 As previously stated

Effect of change

2011 Restated

Statement of Financial Position:

Financial assets

$ 83,904

$ (1,168)

$ 82,736

Assets held on behalf of Government

-

(846)

(846)

Departmental financial position

96,513

(846)

95,667

Statement of Operations and Agency Net Financial Position:

Revenues

56,570

(529)

56,041

Expenses

839,043

(3)

839,040

Net Cash Provided by Government

715,631

236

715,867

Description of Financial - Financial Statements Page 11

3. Summary of Significant Accounting Policies

These financial statements have been prepared using the Government's accounting policies stated below, which are based on Canadian public sector accounting standards. The presentation and results using the stated accounting policies do not result in any significant differences from Canadian public sector accounting standards.

Significant accounting policies are as follows:

Parliamentary authorities

The Agency is mainly financed by the Government of Canada through parliamentary authorities. Authorities provided to the Agency do not parallel financial reporting according to generally accepted accounting principles since authorities are primarily based on cash flow requirements. Consequently, items recognized in the Statement of Operations and Agency Net Financial Position and in the Statement of Financial Position are not necessarily the same as those provided through authorities from Parliament. Note 4 provides a high level reconciliation between the bases of reporting. The planned results amounts in the Statement of Operations and Agency Net Financial Position are the amounts reported in the future-oriented financial statements included in the 2011-12 Report on Plans and Priorities.

Net cash provided by Government of Canada

The Agency operates within the Consolidated Revenue Fund (CRF), which is administrated by the Receiver General for Canada. All cash received by the Agency is deposited to the CRF and all cash disbursements made by the Agency are paid from the CRF.

The net cash provided by Government is the difference between all cash receipts and all cash disbursements including transactions between departments of the Government of Canada.

Due from the Consolidated Revenue Fund (CRF)

The amount of due from CRF are the result of timing differences at year-end between when a transaction affects authorities and when it is processed through the CRF. Amounts due from the CRF represent the net amount of cash that the Agency is entitled to draw from the CRF without further authorities to discharge its liabilities.

Revenues

Revenues for fees, permits and certificates are recognized in the accounts as the services are provided.

Funds received from external parties for specified purposes are recorded upon receipt as deferred revenue. Revenue from external parties for specified purposes is recognized in the period in which the related expenses are incurred.

Other revenues are accounted for in the period in which the underlying transaction or event occurred that gave rise to the revenues.

Description of Financial - Financial Statements Page 12

Revenues earned on behalf of Government are non-respendable and are not available to discharge the Agency's liabilities. These revenues are presented as a reduction to the Agency's revenues. While the President is expected to maintain accounting control, he or she has no authority regarding the disposition of non-respendable revenues.

As a result, non-respendable revenues are considered to be earned on behalf of Government of Canada and are therefore presented in reduction of the Agency's revenues.

(e) Expenses

Expenses are recorded on an accrual basis:

Transfer payments are recognized in the year in which the recipient has met the eligibility criteria or fulfilled the terms of a contractual transfer agreement.

Vacation pay and compensatory leave are expensed as the benefits accrue to employees under their respective terms of employment.

Services provided without charge by other government departments for accommodation, the employer's contribution to the health and dental insurance plans and legal services are recorded as operating expenses at their estimated cost.

(f) Employee future benefits

(i) Pension benefits:

The Agency's eligible employees participate in the Public Service Pension Plan (the ''Plan''), a multi-employer plan administered by the Government of Canada. Both the employees and the Agency contribute to the cost of the Plan. The Agency's contributions are expensed during the year in which the services are rendered and represent the total pension obligation of the Agency. Under present legislation the Agency is not required to make contributions with respect to actuarial deficits of the Plan.

(ii) Severance benefits:

Eligible employees are entitled to severance benefits, as provided for under labor contracts and conditions of employment. The cost of these benefits is accrued as employees render the services necessary to earn them. The obligation relating to the benefits earned by employees is calculated using information derived from the results of the actuarially determined liability for employee severance benefits at the Agency level using specific rates provided by the Office of the Chief Actuary of Canada.

(iii) Other future benefit plans:

The Government of Canada sponsors a variety of other future benefit plans from which employees and former employees can benefit during or after employment or upon retirement. The Public Service Health Care Plan and the Pensioners' Dental Services Plan represent the two major future benefit plans available to the Agency's employees.

Description of Financial - Financial Statements Page 13

The Agency does not pay for these programs as they fall under the Government of Canada`s financial responsibilities, but the Agency records its share of the annual benefits paid under these programs as a service provided without charge by other government departments. No amount is recorded in the Agency's financial statements with regard to either the actuarial liability of these programs at year end or the annual increase of such liabilities.

(g) Accounts receivable and advances

Accounts receivable and advances are stated at amounts expected to be ultimately realized; a provision is made for receivables where recovery is considered uncertain.

(h) Contingent liabilities

Contingent liabilities are potential liabilities which may become actual liabilities when one or more future events occur or fail to occur. To the extent that the future event is likely to occur or fail to occur, and a reasonable estimate of the loss can be made, an estimated liability is accrued and an expense recorded. If the likelihood is not determinable or an amount cannot be reasonably estimated, the contingency is disclosed in the notes to the financial statements.

(i) Inventory

Inventory consists of laboratory materials, supplies and livestock held for future program delivery and not intended for re-sale. It is valued at cost. If it no longer has service potential, it is valued at the lower of cost or net realizable value.

(j) Tangible capital assets

All tangible capital assets and leasehold improvements having an initial cost of $10,000 or more are recorded at their acquisition cost. Amortization of tangible capital assets is recorded on a straight-line basis over the estimated useful life of the asset as follows:

Asset Class

Amortization Period

Buildings

20-30 years

Machinery and equipment

5-20 years

Computer equipment and software

3-10 years

Vehicles

7-10 years

Leasehold improvements

Lesser of the remaining term of the lease or useful life of the improvement

Assets under construction

Once in service, in accordance with asset class

(k) Measurement uncertainty

The preparation of these financial statements requires management to make estimates and assumptions that affect the amounts of assets, liabilities, revenues and expenses reported in the financial statements. At the time of preparation of these statements, management believes the estimates and assumptions to be reasonable.

Description of Financial - Financial Statements Page 14

The most significant items where estimates are used are contingent liabilities, the liability for employee severance benefits and the useful life of tangible capital assets. Actual results could significantly differ from those estimated. Management's estimates are reviewed periodically and, as adjustments become necessary, they are recorded in the financial statements in the year they become known.

4. Parliamentary Authorities

The Agency receives most of its funding through annual Parliamentary authorities. Items recognized in the Statement of Operations and Agency Net Financial Position and the Statement of Financial Position in one year may be funded through Parliamentary authorities in prior, current or future years. Accordingly, the Agency has different net results of operations for the year on a government funding basis than on an accrual accounting basis. The differences are reconciled in the following tables:

a) Reconciliation of net cost of operations to current year authorities used:

(In thousands of dollars)

2012

2011

Net cost of operations before government funding and transfers

$ 826,965

$ 782,999

Adjustments for items affecting net cost of operations but not affecting authorities:

The following table presents details of the Agency's account payable and accrued liabilities:

(In thousands of dollars)

2012

2011

Accounts payable to other government department (OGD)

$6,071

$19,817

Accounts payable to external parties

30,855

47,891

36,926

67,708

Accrued liabilities

41,199

13,945

Total

$78,125

$81,653

In Canada's Economic Action Plan 2012, the Government announced savings measures to be implemented by departments over the next three fiscal years starting in 2012-2013. As a result, the Agency has recorded at March 31, 2012 an obligation for termination benefits for an amount of $22,692,277 as part of accrued liabilities to reflect the estimated workforce adjustment costs.

6. Employee Benefits

Pension benefits

The Agency's employees participate in the Public Service Pension Plan (the ''Plan''), a multi-employer plan, which is sponsored and administered by the Government of Canada. Pension benefits accrue up to a maximum period of 35 years at a rate of 2 percent per year of pensionable service times the average of the best five consecutive years of earnings. The benefits are integrated with Canada/Quebec Pension Plans benefits and are indexed to inflation.

Description of Financial - Financial Statements Page 16

Both the employees and the Agency contribute to the cost of the Plan. In 2011-2012, the Agency contributed $61,137,000 (2011 - $59,151,000), which represents approximately 1.8 times (2011 - 1.9 times) the contributions by employees.

The Agency's responsibility with regard to the Plan is limited to its contributions. Actuarial surpluses or deficiencies are recognized in the financial statements of the Government of Canada, as the Plan's sponsor.

(b) Severance benefits

The Agency provides severance benefits to its employees based on eligibility, years of service and final salary. These severance benefits are not pre-funded and thus have no assets, resulting in a plan deficit equal to the accrued benefit obligation. Benefits will be paid from future authorities. Information about the severance benefits, measured for March 31, is as follows:

As part of collective agreement negotiations with certain employee groups, and changes to conditions of employment for executives and certain non-represented employees, the accumulation of severance benefits under the employee severance pay program ceased for these employees commencing in 2012.

Employees subject to these changes have been given the option to be immediately paid the full or partial value of benefits earned to date or collect the full or remaining value of benefits on termination from the public service. These changes have been reflected in the calculation of the outstanding severance benefit obligation.

(In thousands of dollars)

2012

2011

Accrued benefit obligation, beginning of year

$106,036

$97,591

Transferred to SSC, effective November 15, 2011 (Note 12)

(931)

-

Subtotal

105,105

97,591

Expense for the year

28,117

16,178

Benefits paid during the year

(11,449)

(7,733)

Accrued benefit obligation, end of year

$121,773

$106,036

Description of Financial - Financial Statements Page 17

7. Accounts Receivable and Advances

The following table presents details of accounts receivable and advances:

(In thousands of dollars)

2012

2011 Restated (Note 2)

Receivables from other government departments (OGD)

$2,385

$3,394

Receivables from external parties

6,038

5,887

Employee advances

82

78

8,505

9,359

Less:

Allowance for doubtful accounts on receivables from external parties

(443)

(432)

Accounts receivable

8,062

8,927

Accounts receivable and advances held on behalf of Government

(981)

(846)

Net accounts receivable

$7,081

$8,081

Click on image for larger view

Description of Financial - Financial Statements Page 18

8. Tangible Capital Assets

(In thousands of dollars)

Cost

Accumulated amortization

Capital asset class

Opening balance

Acquisi-tions

Adjustments (1)

Disposals and write-offs

Closing balance

Opening balance

Amortiz-ation

Adjustments (1)

Disposals and write-offs

Closing balance

2012 Net book value

2011 Net book value

Land

$3,331

$ -

$ -

$ -

$3,331

$ -

$ -

$ -

$ -

$ -

$3,331

$3,331

Buildings

277,327

1,664

6,297

37

285,251

183,943

10,121

-

6

194,058

91,193

93,384

Machinery and equipment

83,626

4,190

14

751

87,079

36,330

5,620

(1)

471

41,478

45,601

47,296

Computer equipment and software

65,847

2,580

(6,900)

1,284

60,243

41,559

6,812

(10,952)

1,445

35,974

24,269

24,288

Vehicles

39,246

1,017

-

3,357

36,906

25,729

4,008

-

3,280

26,457

10,449

13,517

Assets under construction

23,945

4,264

(15,524)

60

12,625

-

-

-

-

-

12,625

23,945

Leasehold improvements

47,482

755

241

-

48,478

20,309

11,079

-

-

31,388

17,090

27,173

Total

$540,804

$14,470

$(15,872)

$5,489

$533,913

$307,870

$37,640

$(10,953)

$5,202

$329,355

$204,558

$232,934

(1) Adjustments include assets under construction of $15,524,000 that were transferred to the other categories upon completion of the assets.

Effective November 15, 2011, the Agency transferred computer equipment and software with a net book value of $ 4,919,000 for an acquisition cost of $15,872,000 and accumulated amortization of $10,953,000 to Shared Services Canada. This transfer is included in the adjustments columns (Note 12).

Amortization expense for the year ended March 31, 2012 is $37,640,000 (2011 - $31,550,000).

Description of Financial - Financial Statements Page 19

9. Contingent Liabilities

Claims relating to both legal and employee grievances have been made against the Agency in the normal course of operations. Some of these potential liabilities may become actual liabilities when one or more future events occur or fail to occur. To the extent that the future event is likely to occur or fail to occur, and a reasonable estimate of the loss can be made, an estimate of liability is accrued and an expense recorded in the financial statements.

Amounts have been accrued for contingent liabilities as at March 31, 2012 pertaining to legal claims. The amount of the contingent liabilities for legal claims recognized is based on management's best estimate. Other legal claims against the Agency and other defendants include a class action suit related to bovine spongiform encephalopathy (BSE) for which amounts and likelihood of liability are not determinable.

Claims and litigations for which the outcome is not determinable and an amount of claim can be made by management amount to approximately $84,852,000 ($199,102,000 in 2010-2011) at March 31, 2012.

No amounts have been accrued pertaining to employee grievances as at March 31, 2012.

10. Contractual Obligations

The nature of the Agency's activities can result in some large multi-year contracts and agreements whereby the Agency will be obligated to make future payments when the services/goods are received. Significant contractual obligations that can be reasonably estimated are summarized as follows:

(In thousands of dollars)

2013

2014

2015

2016

2017 and thereafter

Total

Operating leases

$1,924

$4

$-

$-

$-

$1,928

Transfer payments

960

500

-

-

-

1,460

Operating contracts

14,491

1,247

555

404

324

17,021

Total

$17,375

$1,751

$555

$404

$324

$20,409

Description of Financial - Financial Statements Page 20

11. Related Party Transactions

The Agency is related as a result of common ownership to all Government of Canada departments, agencies, and Crown corporations. The Agency enters into transactions with these entities in the normal course of business and on normal trade terms.

(a) Services provided without charge by other government departments

During the year, the Agency received the employer's contribution to the health and dental insurance plans, accommodation, and legal services, without charge from other government departments. These amounts have been recognized in the Agency's Statement of Operations and Agency Net Financial Position as follows:

(In thousands of dollars)

2012

2011

Employer's contribution to the health and dental insurance plans

$43,558

$40,884

Accommodation

30,736

22,980

Legal services

1,909

1,957

Shared Services Canada expenses

6,561

-

Total

$82,764

$65,821

(b) Other transactions with related parties

(In thousands of dollars)

2012

2011

Accounts receivable from other government departments and agencies

$2,385

$3,394

Accounts payable to other government departments and agencies

6,071

19,817

Expenses – Other Government departments and agencies

121,494

123,070

Revenues – Other Government departments and agencies

242

262

Description of Financial - Financial Statements Page 21

12. Transfers from/to other government departments

Effective November 15, 2011, the Agency transferred responsibility for the information technologies activities to Shared Services Canada in accordance with the Order-in-Council of November 15th 2011, including stewardship responsibility for the assets and liabilities. Accordingly, the Agency transferred the following assets and liabilities related to information technologies activities to Shared Services Canada on November 15, 2011:

(In thousands of dollars)

2012

Assets

Accounts receivable (Note 7)

105

Tangible capital assets (Note 8)

$4,919

Total assets transferred

5,024

Liabilities:

Accounts payable and accrued liabilities (Note 5)

1,075

Vacation pay

162

Employee severance benefit (Note 6(b))

931

Total liabilities transferred

2,168

Adjustment to the Agency net financial position

$2,856

During the transition period, the Agency continued to administer the transferred activities on behalf of Shared Services Canada. The administered expenses amounted to $6,561,000 for the year. These expenses were recorded as service provided without charge (Note 11 (a)).

For fiscal year 2010-1011, Public Works and Government Services Canada transferred capital assets to the Agency for a net book value of $6,203,000.

13. Segmented information

Presentation by segment is based on the Agency's program activities architecture. The presentation by segment is based on the same accounting policies as described in the Summary of significant accounting policies in note 3. The following table presents the expenses incurred and revenues generated by program, by major object of expenses and by major type of revenues. The segment results for the period are as follows:

Click on image for larger view

Description of Financial - Financial Statements Page 22

(In thousands of dollars)

2012

2011 Restated (Note 2)

Food Safety Program

Animal Health and Zoonotics Program

Plant Resources Program

International Collaboration and Technical Agreements

Internal Services

Total

Total

Transfer Payments

Compensation payments

$-

$4,806

$183

$-

$-

$4,989

$3,590

Other

-

229

-

950

-

1,179

1,584

Total transfer payments

-

5,035

183

950

-

6,168

5,174

Operating Expenses

Salaries and employee benefits

321,071

123,939

82,813

36,071

105,939

669,833

619,085

Professional and special services

22,095

9,655

4,585

503

28,068

64,906

70,676

Amortization

17,233

7,327

4,426

1,852

6,802

37,640

31,550

Accommodation

16,828

6,495

4,411

1,912

5,354

35,000

33,233

Travel and relocation

9,400

3,782

2,490

1,049

1,931

18,652

21,369

Utilities, materials and supplies

7,896

5,044

2,932

363

2,185

18,420

20,183

Repairs

2,445

6,924

777

110

1,851

12,107

10,827

Furniture and equipment

2,994

1,752

321

24

3,631

8,722

10,993

Communications

1,426

593

321

85

6,952

9,377

10,889

Equipment rentals

467

230

426

19

696

1,838

2,289

Information

382

115

249

1

682

1,429

1,758

Miscellaneous

214

74

46

20

(31)

323

474

Loss of disposal of assets

52

22

13

6

20

113

543

Expenses incurred on behalf of Government

-

-

-

-

(3)

(3)

(3)

Total operating expenses

402,503

165,952

103,810

42,015

164,077

878,357

833,866

Total expenses

402,503

170,987

103,993

42,965

164,077

884,525

839,040

Revenues

Inspection fees

28,910

1,173

4,762

8,243

-

43,088

40,625

Registrations, permits, certificates

2,602

869

794

4,213

-

8,478

9,027

Miscellaneous fees and services

198

1,340

1,836

267

318

3,959

4,405

Establishment license fees

1,874

-

14

-

-

1,888

1,788

Administrative monetary penalties

-

-

-

-

837

837

501

Grading

208

-

-

3

-

211

200

Interest

-

-

-

-

44

44

24

Revenues earned on behalf of Government

-

-

-

-

(945)

(945)

(529)

Total revenues

33,792

3,382

7,406

12,726

254

57,560

56,041

Net cost of operations

$368,711

$167,605

$96,587

$30,239

$163,823

$826,965

$782,999

Description of Financial - Financial Statements Page 23

14. Subsequent events

Subsequent to year end Infectious Salmon Anaemia (ISA) outbreaks in Nova Scotia, Newfoundland & Labrador and British Columbia were identified.

The Nova Scotia outbreak resulted in product compensation payments of $12.3 million in total. Of this amount, $2.9 million has been recorded in these financial statements as a liability since some salmons were declared infected prior to year end. The remainder of the population was declared infected after March 31, 2012.

In Newfoundland & Labrador, no compensation payment has been issued to date. If all eligibility criteria are met, compensation is expected to be in the same order of magnitude as that of Nova Scotia.

The situation in British Columbia is still evolving and the Agency continues to monitor it.

15. Comparative information

Comparative figures have been reclassified to conform to the current year's presentation.

Description of Financial - Financial Statements Page 24

Summary of the assessment of effectiveness of the systems of internal control over financial reporting and the action plan of the Canadian Food Inspection Agency for fiscal year 2011-12 (unaudited)

Annex to the Statement of Management Responsibility Including Internal Control over Financial Reporting

Description of Financial - Financial Statements Page 25

NOTE TO THE READER

With the new Treasury Board Policy on Internal Control, effective April 1, 2009, departments and agencies are now required to demonstrate the measures they are taking to maintain effective systems of internal control over financial reporting (ICFR).

As part of this policy, departments and agencies are expected to conduct annual assessments of their system of ICFR, establish action plan(s) to address any necessary adjustments, and to attach to their Statements of Management Responsibility a summary of their assessment results and action plan.

Assets are safeguarded from risks such as waste, abuse, loss, fraud and mismanagement; and

Applicable laws, regulations and policies are followed.

It is important to note that the system of ICFR is not designed to eliminate all risks, rather to mitigate risk to a reasonable level with controls that are balanced with and proportionate to the risks they aim to mitigate

The maintenance of an effective system of ICFR is an ongoing process designed to identify, assess and adjust as required, key risks and associated internal controls, as well as to monitor its performance in support of continuous improvement. As a result, the scope, pace and status of those departmental assessments of the effectiveness of their system of ICFR will vary from one organization to the other based on risks and taking into account their unique circumstances.

Description of Financial - Financial Statements Page 26

Introduction

This document is attached to the Canadian Food Inspection Agency's (CFIA) Statement of Management Responsibility Including Internal Control over Financial Reporting for the fiscal year 2011-12. As required by the new Treasury Board Policy on Internal Control, effective April 1, 2009, this document provides summary information on the measures taken by the CFIA to maintain an effective system of internal control over financial reporting (ICFR). In particular, it provides summary information on the assessments conducted by CFIA as at March 31, 2012, including progress, results and related action plans along with some financial highlights pertinent to understanding the control environment unique to the agency. This is the second annex produced by the CFIA.

1.1 Authority mandate and program activities

Detailed information on the CFIA's authority, mandate and program activities can be found in the Departmental Performance Report and Report on Plans and Priorities.

1.2 Financial highlights

Financial Statements (audited by the Office of the Auditor General of Canada) of the CFIA for fiscal year 2011-12 can be found in the Departmental Performance Report.

Total expenses were $885M, 76% of which is salaries and employee benefits.

Total revenues were $58M, 75% of which comes from inspection fees.

Total assets and net liabilities were $260M and $234M respectively. Tangible capital assets comprise 79% of total assets. Employee severance benefits comprise 52% of total net liabilities, followed by accounts payable and accrued liabilities of 33%.

The CFIA has a strong regional presence. There are decentralized finance functions in area offices that initiate and approve a significant portion of operating expenses. In order to maximize operational efficiency, all accounts payable and accounts receivable transactions are processed centrally in the service centres located in Guelph, Montreal and Moncton.

The CFIA utilizes an integrated financial system (SAP). This system interfaces with other human resources and operating systems to support CFIA's management of its resources.

1.3 Audited financial statements

The CFIA has always received an unqualified audit opinion from the Office of the Auditor General (OAG), the auditors of the CFIA's Financial Statements since the Agency's creation in 1997.

Description of Financial - Financial Statements Page 27

1.4 Service arrangements relevant to financial statements

The CFIA relies on other organizations and their internal controls for the processing of certain transactions that are recorded in its financial statements, as well as, systems development and maintenance services:

Public Works and Government Services Canada (PWGSC) centrally administers the payments of salaries.

Agriculture and Agri-Food Canada (AAFC) provides acquisition, system development and maintenance services for the information systems used in financial reporting.

Shared Services Canada (SSC) was created on August 4, 2011 to consolidate, streamline and improve the government's information technology (IT) infrastructure services, specifically email, data centre and network services for 43 federal departments and agencies. Effective November 15, 2011, the responsibility for email, data centre and network services, including associated resources, was transferred from the Agency to SSC. The administration and delivery of these services were shared during the 2011-12 transition period while SSC was being established.

1.5 Material changes in fiscal year 2011-12

Significant changes that have occurred during fiscal year 2011-12 are as follows:

George Da Pont was appointed President and Mary Komarynsky was appointed Executive Vice-President on July 11, 2011.

Peter Everson was appointed Vice President of Corporate Management Branch on July 4, 2011.

Joe Freamo was appointed Chief Audit Executive on December 19, 2011.

Control environment of the Agency relative to ICFR

The CFIA recognizes the importance of setting the tone from the top to help ensure that staff at all levels understand their roles in maintaining an effective system of ICFR and are well equipped to exercise these responsibilities effectively. CFIA's focus is to ensure that risks are well managed through a responsive and risk-based control environment that enables continuous improvement and innovation.

2.1 Key positions, roles and responsibilities relative to ICFR

Below are the CFIA's key positions and committees with responsibilities for maintaining and reviewing the effectiveness of its system of ICFR.

President - CFIA's President, as Accounting Officer, assumes overall responsibility and leadership for the measures taken to maintain an effective system of internal control. In this role, the President chairs the Senior Management Committee and is supported by the Executive Vice-President.

Description of Financial - Financial Statements Page 28

Chief Financial Officer (CFO) - CFIA's CFO reports directly to the President and provides leadership for the coordination, coherence and focus on the design and maintenance of an effective and integrated system of ICFR, including its annual assessment.

Vice-Presidents - CFIA's Vice-Presidents in charge of program delivery are responsible for maintaining and reviewing effectiveness of their system of ICFR falling within their mandate.

Chief Audit Executive (CAE) - CFIA's CAE reports directly to the President and provides assurance through periodic risk-based internal audits which can be instrumental to the maintenance of an effective system of ICFR.

Agency Audit Committee (AAC) - The AAC is an advisory committee that provides objective views on the CFIA's risk management, control and governance frameworks. It includes three external members and was established in 2007.

2.2 Key measures taken by the organization

CFIA's control environment also includes a series of measures to enable its staff to manage risks well through raising awareness, providing appropriate knowledge and tools as well as developing skills and capacity. Key measures include:

The establishment of the Office of Values, Integrity and Conflict Resolution;

CFIA's Code of Conduct and CFIA's Conflict of Interest and Post-Employment Code;

The self-assessment is a systematic review conducted by management to provide assurance on ICFR.

3.1 Assessment elements

In support of the Policy on Internal Control, an effective system of internal control has the objective of providing reasonable assurance that:

Transactions are appropriately authorized;

Financial records are properly maintained;

Assets are safeguarded; and

Applicable laws, regulations and policies are followed.

Description of Financial - Financial Statements Page 29

Over time, this includes assessment of design and operating effectiveness of the system of ICFR leading to ensuring the on-going monitoring and continuous improvement of the CFIA's system of ICFR.

Design effectiveness means to ensure that key control points are identified, documented, in place and that they are aligned with the risks (i.e. controls are balanced with and proportionate to the risks they aim to mitigate) and that any remediation is addressed. This includes the mapping of key processes and IT systems to the main accounts as applicable.

Operating effectiveness means that the application of key controls has been tested over a defined period and that any required remediation is addressed.

3.2 Assessment baseline

To determine the scope of the assessment, a scoping and planning exercise was undertaken to identify key business processes, entity level control areas and general computer control areas. During planning and scoping, both quantitative and qualitative factors were considered. These included, but were not limited to: materiality, transactions requiring significant judgment or estimates (e.g. contingent liabilities), complexity of operations, susceptibility to fraud, feedback or recommendations concerning the financial statements or related matters from the Office of the Comptroller General (OCG), and previous audit findings whether from the Internal Audit Directorate (IAD) or from the OAG.

Business processes are defined as the specific processes supporting the treatment of financial transactions.

Entity level controls are defined as the overarching controls of the organization that set the “tone from the top”.

General computer controls are defined as controls over the core financial systems and IT infrastructure used across the organization and which support financial transactions. The CFIA is responsible for assessing effectiveness of all the key IT general controls for systems that it fully manages. The service providers in the other government departments (OGD) are responsible for the internal control self-assessment on the systems that they maintain for the CFIA.

These control areas are the baseline by which the CFIA developed its initial three-year self-assessment plan. This three-year plan will be reviewed and updated on an annual basis to reflect changes in the control environment.

CFIA has completed two years of self-assessment activities which include the majority of areas identified in the three-year plan. The third year of the self-assessment will include completion of 2012-13 self-assessment activities identified in the three-year plan as well as preparation for transition to on-going monitoring commencing in 2013-14. At the end of fiscal year 2012-13, a risk-based multi-year monitoring plan will be in place to enable continuous improvement of the CFIA's system of ICFR.

Description of Financial - Financial Statements Page 30

3.3 Assessment scope during fiscal year 2011-12

During fiscal year 2011-12, the CFIA has taken measures to assess its system of ICFR in the following areas:

Business Processes

Revenue

Pay

Statutory Compensation Payments

Financial Close and Reporting

Operating and Maintenance Expenses

Entity Level Controls

Governance

Risk Management

General Computer Controls

SAP / Enterprise

Peoplesoft

Electronic Invoicing

CFIAIT Access Control and Change Management

4. Assessment results

The following summarizes key assessment results from the design and operating effectiveness testing completed by the CFIA during fiscal year 2011-12.

4.1 Design effectiveness of key controls

When assessing design effectiveness, the CFIA updated process documentation and validated key processes with stakeholders. Design effectiveness testing also validated the appropriate alignment of each key control with risks. During fiscal year 2011-12, the CFIA identified the following improvement opportunities in the design effectiveness of its controls:

Pay

Strengthen the controls of pay transactions.

Revenue

Enhance the information captured in Quality Management System for revenue monitoring purposes; and

Improve the consistency of invoicing processes across the regional offices.

Description of Financial - Financial Statements Page 31

4.2 Operating effectiveness of key controls

When assessing the operating effectiveness of key controls, the CFIA considered the results of the financial statement audits by the OAG, the recent internal audit reports, and the sample testing performed by the self-assessment team. During fiscal year 2011-12, the CFIA identified the following improvement opportunities in the operating effectiveness of its controls:

Revenue

Clarify the roles and responsibilities for the preparation and reconciliation of deposits.

5. Action plan

The following summarizes the actions taken during fiscal year 2011-12 as well as significant elements of work that are planned to be completed in subsequent years.

5.1 Progress during fiscal year 2011-12

During fiscal year 2011-12, the CFIA has made significant progress in assessing and improving its key controls within the system of ICFR. Progress made by the CFIA during 2011-12 is summarized below:

Changes to specimen signature record (SSR) templates to ensure period acknowledgement of manager's responsibility under the CFIA Code of Conduct and the FAA. All revised SSRs have been reviewed and re-signed by managers;

Details on Transfer Payment Programs (TPP)

Name of Transfer Payment Program: Statutory Compensation Payments

Start date: Not Applicable

End date: Not Applicable

Description of Transfer Payment Program: Compensation payments in accordance with requirements established by regulations under the Plant Protection Act, and authorized pursuant to the Canadian Food Inspection Agency Act. These payments are to compensate Canadians, in accordance with the appropriate regulations, for plants ordered destroyed for the purpose of disease control.

Description of Transfer Payment Program: Compensation payments in accordance with requirements established by regulations under the Health of Animals Act and authorized pursuant to the Canadian Food Inspection Agency Act. These payments are to compensate Canadians, in accordance with the appropriate regulations, for animals ordered destroyed for the purpose of disease control.

Comments on Variances: Actual compensation payments made to Canadians were $3.3 million higher than the $0.7 million that was earmarked under Planned Spending. This increase is largely attribute to infectious Salmon Anaemia ($2.2M) in Nova Scotia.

Name of Transfer Payment Program: Federal Assistance Program (FAP)

Start Date: Not Applicable

End Date: Not Applicable

Description of Transfer Payment Program: is the CFIA's only contribution program. Its objective is to support projects and initiatives that advance the Agency's strategic outcome—specifically a safe and accessible food supply and plant and animal resource base. Since the total payment under FAP does not exceed $4.5 million per year, CFIA uses resources from its operating vote to fund this contribution program.

Results Achieved: Contributed to mitigation of risks to Canada's animal resource base which is integral to a safe and accessible food supply system as well as to public health.

Program Activity: Animal Health and Zoonotics Program ($ millions)

2009-10 Actual Spending

2010-11 Actual Spending

2011-12 Planned Spending

2011-12 Total Authorities

2011-12 Actual Spending

Variance

Total Grants

Total Contributions

1.0

1.6

0.2

0.2

0.2

0.0

Total Other Types of Transfer Payments

Total Animal Health and Zoonotics Program

1.0

1.6

0.2

0.2

0.2

0.0

Comments on Variances: FAP is normally used to fund ad-hoc, short term projects.

Audits Completed or Planned: Audit of the Federal Assistance Program (2011) and Follow-up Audit of Federal Assistance Program (2011)

Evaluations Completed or Planned: Evaluation of Federal Assistance Program (2011)

Engagement of applicants and recipients: The CFIA's FAP Program has successfully engaged recipients by providing financial support related to training of individuals in animal epidemiology in areas most relevant to the CFIA: surveillance, risk analysis and disease modeling.

Name of Transfer Payment Program: Federal Assistance Program (FAP)

Start Date: Not Applicable

End Date: Not Applicable

Description of Transfer Payment Program:FAP is the CFIA's only contribution program. Its objective is to support projects and initiatives that advance the Agency's strategic outcome–specifically a safe and accessible food supply and plant and animal resource base.

Results Achieved: Contributed to a coherent, predictable, and science-based international regulatory framework that facilitates meeting regulatory requirements of importing countries' food, animals and plants, and their products, resulting in the facilitation of multi-billion dollar trade for the Canadian economy.

Program Activity: International Collaboration and Technical Agreements ($ millions)

2009-10 Actual Spending

2010-11 Actual Spending

2011-12 Planned Spending

2011-12 Total Authorities

2011-12 Actual Spending

Variance

Total Grants

Total Contributions

0.1

0.0

0.0

1.0

1.0

1.0

Total Other Types of Transfer Payments

Total International Collaboration and Technical Agreements

0.1

0.0

0.0

1.0

1.0

1.0

Comments on Variances: FAP is normally used to fund ad-hoc, short term projects.

Audits Completed or Planned: Audit of the Federal Assistance Program (2011) and Follow-up Audit of Federal Assistance Program (2011)

Evaluations Completed or Planned: Evaluation of Federal Assistance Program (2011)

Engagement of applicants and recipients: The CFIA's FAP Program has successfully engaged recipients by providing financial support with an objective of supporting international science based guidelines that govern safe and competitive trade.

Greening Government Operations (GGO)

Green Building Targets

8.1 As of April 1, 2012, and pursuant to departmental strategic frameworks, new construction and build-to-lease projects, and major renovation projects, will achieve an industry-recognized level of high environmental performance1.

Performance Measure

RPP

DPR

Target Status

Opportunity for Improvement

Number of completed new construction, build-to-lease and major renovation projects in the given fiscal year, as per departmental strategic framework.

To Be Determined

0

Number of completed new construction, build-to-lease and major renovation projects that have achieved an industry-recognized level of high environmental performance in the given fiscal year, as per departmental strategic framework.

To Be Determined

0

Existence of strategic framework.

No

No

Strategies / Comments

The departmental strategic framework will be incorporated as part of the Real Property Management Framework and will be completed by September 2012.

The CFIA is not reporting on this target in future years.

8.2 As of April 1, 2012, and pursuant to departmental strategic frameworks, existing crown buildings over 1000m2 will be assessed for environmental performance using an industry-recognized assessment tool2.

Performance Measure

RPP

DPR

Target Status

Opportunity for Improvement

Number of buildings over 1000m2, as per departmental strategic framework.

To Be Determined

9

Percentage of buildings over 1000m2 that have been assessed using an industry-recognized assessment tool, as per departmental strategic framework.

FY 2011-2012

To Be Determined

0%

FY 2012-2013

To Be Determined

FY 2013-2014

To Be Determined

Existence of strategic framework.

No

No

Strategies / Comments

The departmental strategic framework will be incorporated as part of the Real Property Management Framework and will be completed by September 2012

The CFIA is not reporting on this target in future years.

8.3 As of April 1, 2012, and pursuant to departmental strategic frameworks, new lease or lease renewal projects over 1000m2, where the Crown is the major lessee, will be assessed for environmental performance using an industry-recognized assessment tool3

Performance Measure

RPP

DPR

Target Status

Not Applicable

Number of completed lease and lease renewal projects over 1000m2 in the given fiscal year, as per departmental strategic framework.

Not Applicable

Not Applicable

Number of completed lease and lease renewal projects over 1000m2 that were assessed using an industry-recognized assessment tool in the given fiscal year, as per departmental strategic framework.

Not Applicable

Not Applicable

Existence of strategic framework.

Not Applicable

Not Applicable

Strategies / Comments

The departmental strategic framework will be incorporated as part of the Real Property Management Framework and will be completed by September 2012.

All leased accommodations, where lessee of record is PWGSC, are excluded as per the strategic framework, as PWGSC is responsible for assessing and reporting on Green Building targets. Therefore, it is not feasible for CFIA to participate in this target.

8.4 As of April 1, 2012, and pursuant to departmental strategic frameworks, fit-up and refit projects will achieve an industry-recognized level of high environmental performance4

Performance Measure

RPP

DPR

Target Status

Opportunity for Improvement

Number of completed fit-up and refit projects in the given fiscal year, as per departmental strategic framework.

To Be Determined

0

Number of completed fit-up and refit projects that have achieved an industry-recognized level of high environmental performance in the given fiscal year, as per departmental strategic framework.

To Be Determined

0

Existence of strategic framework.

No

No

Strategies / Comments

The departmental strategic framework will be incorporated as part of the Real Property Management Framework and will be completed by September 2012.

The CFIA is not reporting on this target in future years.

Notes:

This would be demonstrated by achieving LEED NC Silver, Green Globes Design 3 Globes, or equivalent.

CFIA is developing a Ground Transportation Management Strategy. This strategy will include emissions reduction action items.

This target has been exceeded for a number of reasons, the first being the procurement of more fuel efficient vehicles since 2005. Also, CFIA has considerably decreased its kilometres travelled over the years due to more efficient inspection planning, increased car pooling and increased use of videoconferencing and teleconferencing, thereby reducing travel to meetings.

Surplus Electronic and Electrical Equipment Target

8.6 By March 31, 2014, each department will reuse or recycle all surplus electronic and electrical equipment (EEE) in an environmentally sound and secure manner.

Performance Measure

RPP

DPR

Target Status

Achieved

Existence of implementation plan for the disposal of all departmentally-generated EEE.

No

Yes

Total number of departmental locations with EEE implementation plan fully implemented, expressed as a percentage of all locations, by the end of the given fiscal year.

FY 2011-2012

To Be Determined

100%

FY 2012-2013

To Be Determined

FY 2013-2014

To Be Determined

Strategies / Comments

The CFIA implementation plan has been implemented in all CFIA locations across Canada.

Location is defined as all CFIA locations where CFIA personnel maintain a physical presence.

Number of locations within the Agency is 445.

The process for proper disposal of EEE waste has been communicated to all CFIA staff.

Printing Unit Reduction Target

8.7 By March 31, 2013, each department will achieve an 8:1 average ratio of office employees to printing units. Departments will apply target where building occupancy levels, security considerations, and space configuration allow.

Performance Measure

RPP

DPR

Target Status

Opportunity for Improvement

Ratio of departmental office employees to printing units in fiscal year 2010-11, where building occupancy levels, security considerations and space configuration allow.

To Be Determined

Not Applicable

Ratio of departmental office employees to printing units at the end of the given fiscal year, where building occupancy levels, security considerations and space configuration allow.

FY 2011-2012

To Be Determined

1.9:1

FY 2012-2013

To Be Determined

FY 2013-2014

To Be Determined

Strategies / Comments

Print units have been defined as: desktop printers, network printers, multifunctional devices (MFD), photocopiers, faxes and scanners. This definition has been expanded since the 2011-12 RPP where we only included desktop printers, network printers, MFDs and photocopiers.

Excluded are work locations with less than 20 CFIA employees because opportunity for increasing efficiencies is minimal. Also, all laboratories will be excluded from the scope as many of their units are connected to specialized equipment and cannot be replaced by a MFD.

Print unit inventories will be determined using software that will count all networked printing units as well as units connected to networked computers at one date in time. Faxes are non-networked and will be counted manually. A physical count will also be done to exclude locations scoped-out.

Office employees are defined as indeterminate staff.

The method used for determining number of office employees will be CFIA's internal accommodation reports with employees located in scoped-out facilities subtracted.

The estimated number of employees subject to the target is approximately 4,700, 74% of CFIA indeterminate staff.

An integrated CFIA-AAFCIM/IT governance model is being developed which will lay the foundation for management and decisions for IM/IT at CFIA and AAFC, including policy on procurement and use of IT infrastructure.

Paper Consumption Target

8.8 By March 31, 2014, each department will reduce internal paper consumption per office employee (OE) by 20%. Each department will establish a baseline between 2005-2006 and 2011-2012, and applicable scope.

Performance Measure

RPP

DPR

Target Status

Achieved

Number of sheets of internal office paper purchased or consumed per office employee in the 2008-2009 fiscal year.

To Be Determined

5,825

Cumulative reduction (or increase) in paper consumption, expressed as a percentage, relative to baseline year selected.

FY 2011-2012

To Be Determined

20% 4,640 sheets/OE

FY 2012-2013

To Be Determined

FY 2013-2014

To Be Determined

Strategies / Comments

Office employees are defined as indeterminate, term, student, seasonal and as required staff.

Paper is defined as printer paper purchased in packages of 500 sheets.

The method used for determining paper consumption is a manual count of printer paper packages purchased by canvassing CFIA locations with 30 employees or more. This accounts for approximately 70% of CFIA staff. The method used for calculating the other 30% is an extrapolation based on the known 70% as this is a good representation of the employee base.

The method used for determining number of office employees is by using the CFIA Human Resources "Population Snapshot" website. The year end population totals will be used as the number of office employees for each fiscal year.

The number of employees subject to the target, changes in a given year as it is based on employee numbers. For the baseline year 2008-2009, the count on March 31, 2009 was 7,053 employees.

The number of office employees for 2011-12 was 7,291.

This target has already been achieved by better use of electronics (e-mail, text messaging) when sending messages and sharing documents. Double-sided print jobs have been promoted through internal communications and signage in business centres.

Green Meetings Target

8.9 By March 31, 2012, each department will adopt a guide for greening meetings.

Performance Measure

RPP

DPR

Target Status

Achieved

Presence of a green meeting guide.

No

Yes: Adopted March 31, 2012

Strategies / Comments

Adoption of the green meetings guide is defined by its approval from senior management.

The guide is applicable to all internal CFIA meetings as external meetings with other government departments, industry and stakeholders. It provides green options in the areas of hospitality, paper use, procurement, accommodation and travel.

The guide defines the roles and responsibilities of CFIA managers, meeting planners and the National Environmental Office in the application and implementation of the guide.

The guide will be communicated to all staff via the CFIA internal newsletter.

Green Procurement Targets

8.10 As of April 1, 2011, each department will establish at least 3 SMART green procurement targets to reduce environmental impacts.

By April 1, 2013, the CFIA will utilize green consolidated procurement instruments for 95% of its photocopiers and printers procured in a given fiscal year.

Performance Measure

RPP

DPR

Target Status

On Track

Number of photocopiers and printers procured in 2011-2012.

Not Available

23

Percent of photocopiers and printers procured in a given fiscal year where green consolidated procurement instruments were used.

FY 2011-2012

75%

87%

FY 2012-2013

95%

Strategies / Comments

The target only includes photocopiers and printers procured or leased by CFIA's Contracting and Procurement Policy Division.

This target excludes any procurement of specialized/technical equipment where green products are not available.

This self-selected target is SMART:

Specific: Well defined achievement level of 95%

Measurable: Allows comparison over time

Achievable: Tools are in place to achieve result

Relevant: CFIA procures a significant amount of photocopiers and printers and using green procurement instruments will reduce energy use and green house gas emissions

Time-Bound: Date established for target implementation

Data is gathered manually from procurement records

Environmental benefits are derived from these products as they are leased or purchased from PWGSC certified green suppliers which use minimum greenhouse gas emissions and non-fossil fuel products for manufacturing and machining these commodities. As well, these products are fully recyclable thus minimizing hazardous waste disposal.

By April 1, 2013, the CFIA will utilize green consolidated procurement instruments for 95% of its computers procured in a given fiscal year.

Performance Measure

RPP

DPR

Target Status

Achieved

Number of computers procured in 2011-2012.

Not Available

10

Percentage of computers procured in a given fiscal year where green consolidated procurement instruments were used.

FY 2011-2012

75%

100%

FY 2012-2013

95%

Strategies / Comments

The target only includes computers procured by CFIA's Contracting and Procurement Policy Division.

This target excludes any procurement of specialized/technical equipment where green instruments are not available.

Computers are defined as the CPUs of PCs, as these have the most green procurement opportunities.

This self-selected target is SMART:

Specific: Well defined achievement level of 95%

Measurable: Allows comparison over time

Achievable: Tools are in place to achieve result

Relevant: CFIA procures a significant amount of computers and using green procurement instruments will reduce energy use and green house gas emissions

By March 31, 2014, 75% of vehicles purchased annually will be from the CFIA Preauthorised Vehicle List (PAVL), where operational requirements allow.

Performance Measure

RPP

DPR

Target Status

On Track

Number of vehicles procured in 2011-2012.

Not Available

55

Percent of vehicles procured in a given fiscal year from the CFIA Preauthorised Vehicle List (PAVL).

FY 2011-2012

Not Available

69%

FY 2012-2013

Not Available

FY 2013-2014

75%

Strategies / Comments

The target does not include farm equipment, boats, ATVs or snowmobiles.

This self-selected target is SMART:

Specific: Well defined achievement level of 75%

Measurable: Allows comparison over time

Achievable: Tools are in place to achieve result

Relevant: The CFIA develops a PAVL every year based on vehicles that are the most fuel efficient in their class in the Government Motor Vehicle Ordering Guide.

Time-Bound: Date established for target implementation

Of the 55 vehicles procured in 2011-12, 38 were purchased from the PAVL.

The tracking for this target is done through a consolidated acquisition spreadsheet.

The PAVL is distributed via email to all stakeholders every year in advance of vehicle procurement.

8.11 As of April 1, 2011, each department will establish SMART targets for training, employee performance evaluations, and management processes and controls, as they pertain to procurement decision-making.

As of April 1, 2011, 100% of new materiel managers, procurement personnel and acquisition card holders will complete the online course on Green procurement provided by the Canada School of the Public Service.

Performance Measure

RPP

DPR

Target Status

Opportunity for Improvement

Number of new materiel managers, procurement personnel and acquisition card holders in 2011-2012.

Not Available

89

Percent of new materiel managers, procurement personnel and acquisition card holders who have completed the online course on Green procurement provided by the Canada School of the Public Service.

FY 2011-2012

100%

25%

FY 2012-2013

100%

Strategies / Comments

Materiel managers and procurement personnel are identified only as those who work in CFIA's Contracting and Procurement Policy Division.

The low percentage of conformity with this target is due partially to the fact that the policy for new Acquisition Card (AC) holders to take the training was not in full effect until September 1, 2011.

Data is collected manually from Procurement data.

CFIA is in the process of ensuring that all new 2011 AC Cardholders take the Green Procurement Course.

Employee performance evaluations for managers and functional heads of procurement and materiel management

By March 31, 2013, all identified procurement and materiel management functional specialists and their managers and functional heads will have environmental considerations clauses incorporated into their performance evaluations.

Performance Measure

RPP

DPR

Target Status

On Track

Number of identified positions that have environmental consideration clauses in their performance evaluations in 2011-2012.

0

0

Percentage of identified positions that have environmental consideration clauses incorporated into their performance evaluations.

FY 2011-2012

Not Available

0

FY 2012-2013

100%

Strategies / Comments

The number of identified positions is two, both procurement managers.

This self-selected target is SMART:

Specific: Well defined achievement level of all (100%)

Measurable: Allows comparison over time

Achievable: Tools are in place to achieve result

Relevant: CFIA procures a significant amount of goods and services and procuring goods or services that are "green" minimizes CFIA's environmental footprint

Time-Bound: Date established for target implementation

Of the two positions identified to have environmental consideration clauses in their performance evaluations, the clauses have been drafted and will be inserted into the next round of performance evaluations, for fiscal year 2012-2013.

By March 31, 2014, the CFIA Ground Transportation Management Strategy will be developed.

Performance Measure

RPP

DPR

Target Status

On Track

Existence of Ground Transportation Management Strategy

FY 2011-2012

No

No

FY 2012-2013

No

FY 2013-2014

Yes

Strategies / Comments

This self-selected target is SMART:

Specific: The target identifies processes related to a specialized area of procurement

Measurable: Allows comparison over time

Achievable: Resources and responsibilities for target completion have been identified.

Relevant: CFIA procures a significant amount of vehicles and having a ground transportation management strategy that marries traditional fleet practices with green procurement principles will ensure CFIAs fleet is procured and managed in a manner that contributes to a sustainable Canada.

Time-bound: Date established for target implementation

The Ground Transportation Management Strategy (GTMS) working group has developed a draft plan which identifies deliverables, responsibilities and timelines. The GTMS working group has also developed an options document which analyses the current system against 3 options with an objective of achieving utilization and cost efficiencies, meeting operational needs and achieving reductions in greenhouse gas emissions. The completion of the strategy is anticipated by March 31, 2014.

Horizontal initiatives

Table A: Bovine Spongiform Encephalopathy

Name of Horizontal Initiative: Bovine Spongiform Encephalopathy (BSE) Program

Name of Lead Department(s): Canadian Food Inspection Agency (CFIA); Agriculture and Agri-Food Canada (AAFC) (2003-04 to 2007-08)

The BSE program protects human and animal health by conducting surveillance, research and risk assessments regarding BSE and other transmissible spongiform encephalopathies (TSEs) and minimizing the risk of exposure to infected materials; maintains consumer confidence through assessing the effectiveness of the risk mitigation measures and having measures in place to control any potential outbreaks; and supports market access for cattle, beef and related products through promoting and explaining Canada's BSE program to domestic and international stakeholders.

The CFIA verifies that specified risk material (SRM) is being removed from the animal feed chain and the human food chain, monitors products entering and leaving Canada for adherence to Canadian standards or the standards of the importing country, monitors for the prevalence of BSE in the cattle population (through surveillance), verifies that measures to control potential outbreaks are in place and explains Canada's BSE control measures to domestic and international stakeholders (for example, through the veterinarians abroad program) in order to maintain confidence in Canada's BSE program. Health Canada conducts research and risk assessments regarding human exposure to BSE and other TSEs, and the Public Health Agency of Canada (PHAC) carries out surveillance and targeted supporting research in this area as well. AAFC has been involved in supporting, stabilizing and repositioning Canada's beef and cattle industry, including through the provision of compensation payments to stakeholders impacted by BSE in Canada.

Year

Departments

Funding Period

Intent of Funds

2003-04

CFIA, AAFC, HC

2003-04 to 2007-08

-measures to secure the future of the Canadian beef industry

2003-04

CFIA

2003-04 to 2007-08

-the removal of SRM from the food chain and re-entering export markets (referred to as the enhanced BSE initiative)

2004-05

CFIA

2004-05 to 2008-09

-reposition the Canadian beef and cattle industry to operate on a profitable and sustainable basis

-continue the work the Agency was undertaking for the enhanced feed ban

2007-08

CFIA

On-going

-implement the enhanced feed ban restrictions

2008-09

CFIA

2008-09

-extend sunsetting elements of the enhanced BSE initiative

2009-10

CFIA, PHAC, HC

2009-10 to 2013-14

-continue work on the core BSE activities

Shared Outcome(s): Contributing to the protection of human and animal health, which supports domestic and international market access for Canadian cattle, beef and beef products.

Governance Structure(s): The CFIA is the federal lead for the delivery of the BSE Program. In 2008, a summative evaluation of the CFIA's BSE program was conducted, which noted that the governance of the program should be strengthened to enhance coordination and communication regarding BSE-related activities, both internally and with other partner organizations. The CFIA accepted this recommendation and agreed to develop options for an improved governance model to facilitate horizontal dialogue that is consistent with governance models for related horizontal initiatives. In 2010, the CFIA launched a new committee structure to bring the Agency's overall approach to governance more in line with evolving business needs. The new governance structure focuses on the importance of sharing information internally and ensures a more efficient and streamlined senior-level committee structure. It is expected that the renewed structure will foster a whole-of-Agency approach to decision-making and will support day-to-day operations across the Agency. To ensure business line perspectives are integrated into decision-making, the three senior executive-level committees are supported by four committees: Animal Health, Plant, Food and Horizontal Management.

Performance Highlights: In 2011-12, the Government continued to work on core BSE activities that contribute to the protection of human and animal health.

Federally inspected slaughter and boning establishments continue to be verified on-site by CFIA. Record reviews are also performed by CFIA inspection staff to verify that:

-compliance to the control program - effectiveness of the control program

In the 2011-12 fiscal year, a compliance rate of 99.8% has been achieved in 4817 tasks delivered on the enforcement and verification of SRM removal.

Provincially inspected slaughter and boning establishments continue to be verified on-site and record reviews are performed by CFIA inspection staff to ensure that the removal, segregation and disposal of SRM, are carried out to determine the adequacy of Provincial oversight regarding plant controls.

These reviews have been and will continue to be a crucial part in our ongoing efforts to strive for continuous improvements to the consistency and overall quality of our inspection verifications and related activities in non-registered provincial establishments.

Import Controls

$2.8M (2004-05 to 2013-14)

$0.3M

$0.2M

Products imported into Canada meet Canadian standards:

The CFIA reviews and updates all import policies and conditions applicable for BSE in order to reflect changes to international standards, domestic regulatory requirements and evolving science; this is done on an annual basis as the OIE amends the Terrestrial Animal Health Code and as required otherwise

3. Co-partnered scientific review and analysis with Health Canada on the manufacture process of gelatine and other highly processed products from cattle hides sourced from controlled and undetermined risk for BSE countries

2. Reviewed and updated as required, with a minimum of 25 percent of the procedural imports policies, by commodity type, reviewed annually for precision and clarity (example - combined the 5 different rendered and inedible products import policies into one document); further updates ongoing so that over a 4 year cycle, all import policies will have been reviewed for accuracy and scientific/ technological advancements.

CFIA continues to conduct animal health risk assessments on TSE to support the National Terrestrial Animal Health Program.

CFIA conducted a joint scientific analysis on reduction of BSE infectivity in the production of bovine hide derived gelatine and other highly processed products in collaboration with Health Canada.

BSE Surveillance

$159.9M (2003-04 to 2013-14)

$15.4M

$15.4M

Safe animals and food.

1. Monitoring prevalence of BSE in Canada and assessing the effectiveness of the BSE control measures including the Feed Ban and imports controls

2. Analyzing options to redesign the BSE surveillance program and consulting with stakeholders to explore further targeting of surveillance.

In 2011-12, the CFIA continued to deliver surveillance activities along with the national reimbursement program on at risk animals including clinical suspects and over 30 months of age cattle that are dead, down, dying or diseased. Surveillance samples were collected from cattle on-farm, at rendering facilities, dead stock facilities or provincial and federal abattoirs. The CFIA successfully collected and tested 30,872 samples, 19,654 of which were processed in CFIA laboratories. Monitoring the level and distribution of BSE in Canada through the weighing of surveillance samples with the OIE recommended allocating of points, has allowed Canada to maintain a controlled BSE risk status and to maintain and expand market access.

There were no detected cases of BSE in Canada during the 2011-12 fiscal year. The last detected case of BSE in Canada was in February 2011. The investigation report, containing the epidemiological investigation based on the OIE Terrestrial Animal Health Code for a country with controlled risk status, comprised of the trace out of all cattle reared with the BSE case during its first year of life (feed cohort) as well as all cattle born in the same herd as, and within 12 months of the birth of the BSE case (birth cohort). All 361 of these equivalent risk animals were traced from on-farm records during the investigation. The CFIA has completed the humane destruction of all remaining equivalent risk animals.

Cattle Identification

$29.2M (2003-04 to 2013-14)

$2.8M

$2.3M

Safe animals and food.

Continue work on cattle identification enforcement activities, including verification at auctions and federally and provincially inspected abattoirs that cattle are identified with an official ear tag.

Federal abattoirs are inspected weekly to verify compliance for Part XV regulatory requirements, one of which is that cattle received at the abattoirs are bearing an approved tag. In 2011, 1,659 inspections conducted at federally-inspected abattoirs showed a compliance rate of 97% for this requirement.

The CFIA inspection staff continues to monitor and enforce the Canadian Livestock Identification and Traceability program (TRACE) at auctions, dead stock collectors, farms and livestock operations, feedlots, provincial abattoirs, renderers and tag distributors. 8,779 inspections were performed at those sites with a tagging compliance rate of 98%.

TRACE has performed extensive work on:

-training material for inspectors, development of a Manual of Procedures, adoption of compliance verification system (CVS) in the program; -a livestock traceability data sharing agreement with Manitoba Agriculture, Food and Rural Initiatives -an epidemiological, disease control and compliance verification perspective of acceptable enhancements to the cattle traceability system in support of a proposed regulatory amendment -a revised tag approval and revocation framework with the objective of improving the performance of approved tags -program delivery and design options in order to meet ministerial commitments with respect to livestock traceability -a legislative framework which will provide stronger traceability regulatory-making authorities -a single-window initiative through which authorized used would have access to traceability data collected in multiple databases in order to enhance our ability in managing a sanitary issue and verifying compliance.

Continue the provision of export-related certification services to a wide range of affected industries.

The CFIA remains committed to promote an international regulatory framework to protect Canadian exporters from discriminatory and unnecessary barriers. The CFIA also leads or participates in a number of international and bilateral agreements. Consistent with its international regulatory cooperation framework, the CFIA maintains close relations with key foreign regulatory counterparts.

Enhanced Feed Ban

$241.0M (2004-05 to 2013-14) plus $26.6M ongoing

$26.6M

$14.4M

Safe feed, fertilizer, animals and food.

Continue the enforcement of enhanced feed ban restrictions.

The CFIA began enforcing an initial set of feed ban regulations in 1997. At that time, these new regulatory requirements (without benefit of any additional funding) were integrated into existing inspection programs for feed and feed ingredient manufactured, distributed and used by inedible rendering plants, commercial feed mills and on farms.

In response to the detection of a native-born case of BSE in Canada in 2003, the CFIA received additional funding in 2005-06 and subsequent fiscal years to support implementation and enforcement of an enhanced feed ban regulatory framework that took effect in 2007. The impact of implementing the enhancements principally involved:

2. Implementing and administering a system of control permits and compliance inspection activities at abattoirs, dead stock collectors, landfills and other processing and disposal sites regarding the collection, transport, treatment and disposition of cattle Specified Risk Material (SRM) tissues. As part of the enhanced regulations, SRM must be segregated, identified and appropriately managed until final disposal. CFIA workload increased to include inspection oversight of SRM equipment and facilities, tracking movement at several points in the chain to final disposal or alternative use not historically subject to CFIA inspection.

3. During 2011-12 the CFIA maintained its marketplace monitoring program to verify compliance of fertilizers and supplements containing prohibited material (PM) with the requirements of the Enhanced Feed Ban. This included review of fertilizer and supplement labels for proper precautionary statements, record keeping and recall procedure verification to mitigate against potential feeding to animals, and to ensure manufacturers, distributors, importers and sellers could conduct an effective product recall if necessary. To address the potential use of SRM in fertilizers and supplements, the CFIA continued to issue permits, under the Health of Animals Regulations. Permit issuance was based on adherence to processing requirements (eg. composting) as well as conditions for final disposal (ie. use on non-food non-feed and non grazing land) to effectively mitigate against any potential risks to human, animal health and the environment).

4. During the 2011 calendar year, the CFIA continued to verify compliance with the enhanced 2007 regulatory framework at facilities along the animal food and production chain (i.e. at rendering plants, commercial feed manufacturers, feed retail outlets, on-farm feed manufacturers and ruminant feeders as well as at meat slaughter and processing establishments, cattle dead stock collectors, transporters and receivers of SRM, commercial composting and fertilizer manufacturing facilities).

Confidence in Canada's animal production and food system, facilitating access to domestic and international markets. Continue the establishment and maintenance of strong relationships with trading partners, and the provision of global leadership and influence regarding international policies and standards development.

The CFIA continues to play an active and participatory role at the international level. In addition, the CFIA is contributing and influencing international science based disease control standards for BSE, which are critical components of the foundation for safe trade and the maintenance of international market confidence. On a bilateral basis this involves the invitation to trading partners for incoming technical missions to confirm first hand the integrity and implementation of Canada's inspection controls. At the multilateral level, the CFIA is maintaining the official designation as a BSE Controlled Risk country through the evaluation process of the 176 member country World Organization for Animal Health (OIE). The CFIA continues to contribute to the discussions at OIE, not only with respect to the General Session and in revisions to the various Codes, but also with respect to having an OIEBSE reference laboratory as well as CFIA employees on a number of the OIE commissions.

Accelerating Implementation of Traceability in Livestock and Meat Sources

$16.1M (2004-05 to 2006-07)

$0.0M

$0.0M

Farm Income Payment Program

$999.9M (2004-05 to 2005-06)

$0.0M

$0.0M

Cull Animal Program

$202.4M (2003-04 to 2005-06)

$0.0M

$0.0M

Loan Loss

$38.4M (2004-05 to 2008-09)

$0.0M

$0.0M

Feeder/Fed Cattle Set-Aside Program

$296.3M (2004-05 to 2005-06)

$0.0M

$0.0M

Subtotal AAFC

$2,887.3M (2003-04 to 2013-14)

$0.0M

$0.0M

1 Technical Market Access Support: Planned Spending has been reduced by $1.4 million to take into account amounts transferred to the Department of Foreign Affairs and International Trade to provide support to CFIA staff located at missins abroad.

2 Agriculture and Agri-food Canada: Funding sunsetted in 2007/08

Federal Partners

Federal Partner Program Activity

Names of Programs for Federal Partners

Total Allocation (from Start Date to End Date) ($ units)

2011-12 ($ millions)

Planned Spending

Actual Spending

Expected Results

Results Achieved

Public Health Agency of Canada (PHAC)

Surveillance and Population Health Assessment

Science and Technology for Public Health

Surveillance and Research for Human TSEs

$7.9M (2004-05 to 2013-14)

$0.8M

$0.8M

1. Continued prospective, case-by-case, laboratory-based investigation of all human TSEs across Canada.

1. reviews and provision of scientific-related input on guidance/ regulatory development initiatives.

2. products: a) reporting on/assessments of risk from products derived from donors identified with various forms of TSEs; b) participation on the Working Group on Prion Risk from Human-derived Biologics.

There was ongoing monitoring of country of origin of plasma for plasma derived products and Human derived Excipients.

Animal-derived reagents/ excipients were tracked and assessed in cell therapy submissions to ensure risk mitigation measures had been put in place by the sponsor.

Vaccine products with animal derived materials were assessed to ensure that they were in compliance with relevant guidelines.

Health Canada also assessed changes to suppliers of animal derived materials in Notifiable Change submissions, and assessed submissions for products in which manufacturers replaced animal derived materials with yeast derived materials to ensure that the changes did not impact the quality, efficacy, and safety of the product.

Health Canada followed-up on reports of individuals with vCJD infection in order to assess potential risks to the blood supply and to determine whether or not changes should be made to the blood donor screening criteria (one case in 2011-12).

Health Risk Assessments were performed in cases where cell, tissue and organ (CTO) establishments failed to comply with prion-related donor screening questions (about six live donor kidney programs in Canada).

Indicators and Targets:

Number of direct consultations/ visits with stakeholders as a result of Canadian expertise Number and type of training, conferences, symposiums, etc. attended by HC staff on BSE/TSE topics

Number of research citations related to BSE/ TSE peer reviewed publications produced by HC

Number and description of policies/standards on BSE/ TSE contributed by HC to the international community

Number of master files and product license applications reviewed which may contain ingredients sourced from animals and which may be susceptible to BSE/ TSE

Health Canada contributed to the revision of prion-related screening questions for donors of cells, tissues and organs in the Canadian Standards Association Standards that are referenced in Health Canada's Regulations for Cells, Tissues and Organs (Ongoing assessment and revision).

Health Canada employees attended meetings with WHO Blood Regulators, the WHO Expert Committee on Biologics Standardisation, and the European Directorate for Quality in Medicines.

Dr. Yves Aubin was an invited speaker at the Canadian Society for Chemistry 94th Canadian Chemistry Conference and Exhibition (Jun. 5-9, 2011). He presented his research on the structure of a component of the infectious prion protein that causes TSE and its interactions with human cell models.

Health Canada continued to review master files and product license applications which may contain ingredients sourced from animals and which may be susceptible to TSE. As part of the risk assessment, every review requires an assessment for animal sourced ingredients. Of the 12,685 drug products currently marketed in Canada, 23% or 2914 drug products have declared ingredients of bovine or cattle origin. A total of 1343 DINs were assigned to new products, 197 or 15% of those products were voluntarily declared to contain ingredients of animal origin. The products assigned new DINs include those resulting from brand name or company name changes. In addition, 17 Drug Master Files (DMF) were reviewed which contained material derived from bovine or cattle animal tissue.

Conduct consultations with stakeholders, external collaborations/ research and training and conferences attendance.

Indicators and Targets:

Number of direct consultations/ visits with stakeholders as a result of Canadian expertise

Number and type of training, conferences, symposiums, etc. attended by HC staff on BSE/ TSE topics

Number of research citations related to BSE/ TSE peer reviewed publications produced by HC

Number and description of policies/ standards on BSE/ TSE contributed by HC to the international community

Number and dollar amount of external collaborations

Evaluation

Health Canada continued to conduct risk assessments and unique research projects in collaboration with external partners (CFIA, European research Institutions) to generate critical data related to the pathogenesis of BSE, TSEs, and specified risk material to support hazard characterization, risk assessment and standard setting. Health Canada continued its scientific and expert role as a member of Canada's national and international delegations for BSE and TSEs.

Health Canada held nine external consultations related to BSE including atypical BSEs and their pathogenesis, detection, risk assessment, specified risk material (SRM) as defined for food and feed, and the safety of Canadian beef and beef products. Additionally, chronic wasting disease (CWD) and scrapie were also consulted on but to a lesser degree but followed the same approach as for BSE.

Three direct consultations were held to discuss the safety of Canadian beef and beef products and BSE and risk assessment.

One consultation was held on the safety of tallow and the potential use of SRM as a feed and food.

Provincial, national, international and industry consultations on Canada's responses to BSE included consultation on new research findings primarily related to detection, pathogenesis and infectivity studies of BSE, atypical BSE and other TSEs and the potential to amend SRM lists and definitions, and Health Canada's food risk assessments. Health Canada participated as a member of Canada's expert BSE international delegation on BSE. All consultations focused on science findings, and their interpretation directed to improve and maintain human and animal health and to seek harmonisation with respect to BSE and other TSEs policies based on science.

Health Canada sponsored and participated in an international meeting: Prion 2011 in Montreal, and one Prion training session was held then.

Nine science posters and three publications were developed and peer reviewed. The content was the direct result of novel research activities and scientific findings related to BSE, atypical BSE and TSE. All were directed towards early detection of TSEs or prions (PrP), and the pathogenesis and associated infectivity of BSE, atypical BSE and other TSEs. The posters were presented at the International Prion 2011 Conference held in 2011 in Montreal, and were published through the conference venue and related to either BSE, atypical BSE, CWD or scrapie. All are original research based on oral challenge studies to focus on TSE infectivity, species barrier, pathogenesis for determining and defining SRM for food and product safety and for risk assessment. The three publications were: "Pathogenesis of BSE and Atypical BSE in Cattle", "Early Spread of BSE Prions from the Gut via the Peripheral Nervous System to the Brain", and "Histopathological observations on the neural pathogenesis of experimental BSE of cattle".

Health Canada contributed new research findings and expertise to existing BSE/ TSE policies in Canada (eg. definition of SRM) and internationally. The three international policies related to countries' re-assessment of their existing BSE food safety policies and the safety of beef and beef products in light of the new science published or being generated under Health Canada research. There were no new national or international policies developed.

Unique research projects in collaboration with external partners (CFIA, European research Institutions) totalled $1.3M.

A summative evaluation was conducted on the Bovine Spongiform Encephalopathy initiatives that were undertaken between 2003 and 2009. Both the first drafts of the evaluation and the Management Action Plan (MAP) were completed, with final versions of the document anticipated in summer 2012.

Compliance and Enforcement

$1.0M (2003-04 to 2007-08)

$0.0M

$0.0M

Product Assessment

$6.2M (2003-04 to 2007-08)

$0.0M

$0.0M

Tracking and Tracing

$3.1M (2003-04 to 2007-08)

$0.0M

$0.0M

Total HC

$72.4M

$6.2M

$4.2M

Total

$3,601.1M

$70.9M

$49.3M

Comments on Variances:

CFIA: The variance between planned spending and actual spending is related to the reallocation of resources to other agency priorities.

AAFC: Not Applicable

PHAC: Not Applicable

Health Canada: The majority of the variance is the result of funds having been reallocated to support core business and mandated food regulatory activities. The remainder of the variance is due to a delay in the start of the summative evaluation, which will result in expenditures associated with the remaining evaluation activities to be incurred only in Q1 and Q2 of FY 2012-13 instead of FY 2011-12.

Results to be achieved by non-federal partners (if applicable): Not Applicable

The NAAHP's goal is to protect Canada's aquatic animal resources and productivity by preventing the introduction and spread of aquatic animal diseases, and by maintaining the seafood industry's competitiveness in international markets. This is in line with the Government of Canada's priority to protect Canada's natural resources and economic stability. The Agency's priority in this area is a safe and sustainable animal aquatic resource base.

Governance Structure(s): The CFIA is the federal lead for delivery of the NAAHP in collaboration with DFO; respective federal roles and responsibilities are outlined in a Memorandum of Understanding (MOU). The Animal Health Business Line and the Horizontal Steering Committee for Aquatic Animal Health are responsible for monitoring financial governance within the CFIA budget. At the Federal, Provincial and Territorial (FPT) level, the Canadian Council of Fisheries and Aquaculture Ministers (CCFAM) has oversight over the program through a working group with the CFIA. There is also an industry/Federal/Provincial/Territorial advisory committee, the Aquatic Animal Health Committee, which meets annually to guide the development of the program.

Performance Highlights: The implementation of the NAAHP continued. This included the implementation of the import controls for aquatic animals under the Health of Animals Regulations, which came into force on December 10, 2011. Prior to full enforcement of the Regulations, there is a one-year transition period supported by a Stream of Commerce Policy from December 2011 to December 2012. The development and implementation of surveillance initiatives also continued. Other program functions, such as certifying exports of aquatic animals, engaging in emergency disease response activities, developing risk assessments, and carrying out disease surveillance plans, were conducted.

Development of training material for key NAAHP implementation activities (5 National Training Initiatives).

Development of standards and P&Ps for compartmentalization to replace Fisheries and Oceans Canada's Fish Health Protection Regulations in relation with imports.

Consultations were organized with regional industry stakeholders to discuss the import controls. In addition, the process for information-sharing and consultations with First Nations and Aboriginal Groups relative to the Program was developed.

The NAAHP met with provincial and territorial departments to continue discussions on the development and implementation of surveillance initiatives, regulatory options around the proposed domestic movement control program and delineation of zones to control the spread of federally reportable diseases that currently exist in Canada.

The NAAHP wrote the policy on Import. Furthermore, the Program developed the import permit process, application form, the Stream of Commerce Policy, etc. For the Export Program, the NAAHP continued to develop the Standards Operating Procedures (SOPs) for each negotiated export certificate.

The NAAHP integration into existing CFIA application system was realized when possible. Work continued on the interface between CFIA and DFO for laboratory sampling and result of analysis service.

The NAAHP developed the Surveillance Plan for Infectious Salmonid Anemia Virus (ISAV), Infectious Pancreatic Necrosis Virus (IPNV) and Infectious Hematopoetic Necrosis Virus (IHNV) in Anadromous Salmonids in British Columbia. In addition, the NAAHP continued the implementation of the surveillance in Pacific oysters and Manila clams in British Columbia; the development of the regionalization assessment; the development of the eastern surveillance for finfish and molluscs; and the finalization of the regionalization framework for crustaceans and molluscs for the East and West Coasts.

The NAAHP finalized the development of the materials for the five National Training Initiatives.

The NAAHP developed the policy, procedures and training for the compartmentalization program for trade.

Subtotal CFIA

$32.1M (2005-06 to 2009-10) and $6.4M ongoing

$6.4M

$5.3M

Federal Partners

Federal Partner Program Activity

Names of Programs for Federal Partners

Total Allocation (from Start Date to End Date) ($ units)

2011-12 ($ millions)

Planned Spending

Actual Spending

Expected Results

Results Achieved

Fisheries and Oceans Canada (DFO)

Aquatic Animal Health

National Aquatic Animal Health Laboratory System (NAAHLS)

$26.9M (2005-06 to 2009-10) and $4.0M ongoing

$4.0M

$4.0M

Laboratory standards and tracking system that meets international requirements for audit/ challenge of export certificates and/or import controls, and International Organization for Standardization (ISO) 17025 Laboratory Accreditation

The development and validation of diagnostic tests continued. At the end of fiscal year 2011-12, the validation of 30 0f 32 tests were completed.

Laboratory Information System became operational April 1, 2012.

Fish Health Protection Regulations were amended December 2011 to align with the Health of Animals Regulations.

With the Canadian Food Inspection Agency as the lead, discussions were initiated with stakeholders for the creation of a National Aquatic Animal Health Laboratory Network.

Subtotal DFO

$26.9M (2005-06 to 2009-10) and $4.0M ongoing

$4.0M

$4.0M

Total

$59.0M (2005-06 to 2009-10) and $10.4M ongoing

$10.4M

$9.3M

Comments on Variances:

CFIA: Of the total of $6.4 million allocated to the NAAHP, $5.3 million was spent. The remaining $1.1 million can be explained by the following: corporate reallocations of $0.6 million was put towards other CFIA priorities and $0.4 million was due to delays in staffing and projects.

DFO: No variance to report.

Results to be achieved by non-federal partners (if applicable): Not Applicable

The objective of this horizontal initiative was to address recommendations made in the report by the government appointed Independent Investigator, Sheila Weatherill, who reviewed the circumstances leading to the 2008 Listeriosis outbreak in Canada. The Government developed an action plan based on three thematic areas: address immediate food safety risks, enhance surveillance and early detection, and improve Government response to food-borne illness outbreaks in Canada.

To implement the action plan, the three federal organizations – CFIA, HC, PHAC – received a total spending authority of $75.0 million over three years (CFIA: $46.8 million, PHAC: $17.7 million, and HC: $10.5 million). Each federal organization identified the resource requirements, strategic outcomes, objectives and implementation plan for each thematic area. Implementation of this horizontal initiative has further enhanced Canada's food safety system.

Governance Structure(s): Responsibility for the implementation of the recommendations made by the Independent Investigator is based on the mandates of the CFIA, HC, PHAC. In addition, the Deputy Minister of AAFC chairs a special committee of deputy heads from CFIA, HC and PHAC which provides recommendations to improve the ways the organizations work together to deliver their food safety mandates. The CFIA, PHAC, HC, and AAFC work horizontally through a governance structure to implement and monitor the implementation of the recommendations.

The governance framework included an ADM-level Committee on Food Safety (ADM-CFS) that was supported by a DG-level committee. The ADM-CFS received direction from the AAFC, CFIA, PHAC, and HC deputy heads. Furthermore, each department monitored the implementation of the recommendations through a department specific governance structure that included inter-branch director-level, executive director or DG-level, vice-president or ADM-level, and senior management-level committees.

Performance Highlights: Key performance results achieved by CFIA, HC, and PHAC include clarified roles and responsibilities, enhanced coordination of oversight of food safety among federal partners and industry, and improved communication among federal partners, industry and the public on food safety issues. These achievements have led to improved management of risks associated with Listeria in RTE meats and better prevention of foodborne illnesses in Canada.

As of January 2011, all 70 FTEs have been hired. In 2011-12, the Agency focused on maintaining this expanded workforce. The increased inspection capacity has allowed CFIA to deliver enhanced inspection activities. Consequently there has been an improvement in the management of food safety risks in federally registered RTE meat establishments.

The National Training Plan for Meat Processing Inspectors was finalized on July 6, 2011. It includes 34 technical courses divided into 9 weeks of in-class workshops. In 2011-12, 58 Listeria project inspectors completed all of the training and more than 250 inspectors partially completed the training (3850 person days in total). In addition, 15 e-learning courses were developed and tablet technology was successfully piloted in the delivery of the training material. An evaluation of the training program was also completed which indicated that, overall, the program is meeting training objectives.

*The number of staff trained on updated policies was not reported for this initiative because Health Canada's revised Listeria policy had not yet been finalized.

The CFIA's network service provider has enabled a secure method of connecting remote devices (aircards) to allow inspectors to utilize the Agency's resources from anywhere there is a cellular signal. Should a signal be lost, the inspectors sessions are kept alive until the signal returns, thereby preventing data loss. All 501aircards were activated in 2011-12.

In addition, a pilot project was initiated in 2011-12, where a dozen special 'ruggedized' tablets were deployed to inspectors to test how well it would allow them to work and communicate in the less than ideal conditions, such as the cold or wet environments found in laboratories and abattoirs. Results for this pilot project are pending.

Enhanced Food Safety Program Risk Management

$4.6M

$1.8M

$1.1M

Review of food safety programs and directives to apply similar lessons learned.

The Meat Hygiene Manual of Procedures was updated to reflect revisions to Health Canada's "Policy on Listeria monocytogenes in Ready –To-Eat Foods". The CFIA increased its capacity for trend analysis to improve its risk-based monitoring approach to RTE meats. In order to increase the focus on higher-risk products, sampling frequencies for RTE meats were revised based on the risk posed by the product. This resulted in higher risk products being sampled more often.

Improve test detection methods for Listeria and other food-borne hazards

$0.3M

$0.5M

$0.4M

Improve test detection methods for Listeria and other food-borne hazards to provide greater availability and choice of testing methods for the detection of Listeria, and faster turn around time for reporting of results.

The CFIA continues to improve and validate detection methods for Listeria in meat products and in the meat processing environment to reduce the time required to test samples and enable more rapid response during food safety investigations.

As planned for 2011-12, two analysts were maintained to continue their work on improving test detection methods.

Throughout 2011-12, a new method for the rapid confirmation of Listeria from meat and environmental samples was validated. This validation work will undergo a technical review in 2012-13.

The CFIA's laboratory capacity was enhanced to enable testing of additional RTE meat and environmental samples, which were planned as a result of the updated Listeria Directives. Since 2009, product samples for Listeria testing have increased approximately threefold. Furthermore, the funding enabled the continuation of the reinstated environmental monitoring program for Listeria in RTE meat establishments, which enabled the purchasing of the environmental test kits used by inspectors, as well as the testing of over 1000 environmental samples per year.

In 2011-12, four food program specialists were dedicated to trend analysis. A process was developed for reporting and trend analysis of data collected on Listeria in RTE meats. Monthly trend analysis bulletins were produced internally and one of these reports was finalized and distributed to stakeholders in 2011-12. CFIA will continue to improve the reporting process to have trend analysis bulletins distributed to stakeholders monthly.

Government of Canada food safety portal

$1.0M

$0.4M

$0.4M

Streamlined portal for all Government of Canada food safety information. Canadians are aware of and contribute to management of food safety risks.

CFIA is the lead organization for coordinating food safety information and maintaining the Food Safety Portal (www.foodsafety.gc.ca) for the Government of Canada.

In 2011-12, the portal was maintained and updated to reflect new information posted by participating departments and agencies. Research was conducted on visitor usage of the portal and CFIA website food safety content that is linked to by the site.

A visitor pattern analysis for the period of July 2011 to December 2011 showed 25,200 visits to the portal and 61,800 page views. Activities also included technical improvements to the CFIA website to enhance food safety information. As well, the Agency participated in five food related events and exhibits in 2011-12 to promote the Food Safety Portal and raise awareness of safe food-handling practices and recall procedures.

Genomics: Piloting of genomics as a modern and innovative public health laboratory tool was completed with the United States Centers for Disease Control and Prevention during the investigation of the Haitian cholera outbreak. The National Microbiology Laboratory (NML) also continued work on Listeria genome sequencing and the development of genomics infrastructure that is targeted for use within the PulseNet Canada outbreak response framework. The plan of completing 20 sequences over the two-year period 2010-2012 was surpassed, with the sequencing of 119 strains completed.

PulseNet Canada: For the purposes of expanding outbreak detection capacity, a multi-media laboratory training tool (for lab methodology, data analysis, partner communication during outbreak responses) was completed and beta-tested with select PulseNet Canada partners. In 2011, there were 22% more PFGE fingerprinting uploads to PulseNet Canada at the NML as compared to 2009.

Public health Preparedness and Capacity

Public Health Tools

$4.5M

$1.5M

$0.5M

National public health tools and platforms are implemented in the outbreak module.

The Public Health Agency of Canada initiated the Outbreak Management Project with the goal of providing recommendations related to its potential use of Canada Health Infoway's Panorama case management system in the management and coordination of multi-jurisdictional food-borne outbreaks.

The review of existing Agency outbreak management systems and documentation identified several generic business process categories and associated business requirements. Based on current Agency multi-jurisdictional food-borne outbreak management business processes and the results of the gap-fit analysis, the Agency does not require an instance of Panorama. In the absence of pan-Canadian Panorama jurisdictional implementations, the Agency is not concentrating on one specific technology for the receipt, management, and distribution of outbreak related information, as jurisdictions will continue to use differing systems as they see fit.

The participating jurisdictions in Panorama are British Columbia, Yukon, Saskatchewan, Manitoba, Ontario, and Quebec. None of the provincial/territorial participants currently have the outbreak management module deployed. The percentage of provinces/ territories deploying Panorama outbreak module is 6/13 or 46% - this includes all 6 actively participating jurisdictions who have varying schedules for deploying the outbreak management module.

With recognition that multiple electronic systems will be in use across Canada for managing public health information, the Public Health Agency of Canada intends to continue focusing on data standards and systems interoperability to support pan-Canadian management of outbreaks and facilitate an efficient and quasi seamless flow of critical information within a jurisdiction and across jurisdictions during such situations.

Public health Preparedness and Capacity

Emergency Preparedness

$4.2M

$2.2M

$2.1M

Develop an operational framework that provides procedures and guidance to the Health Portfolio for the coordination and management of food-borne illness emergencies.

A multi-faceted risk communications plan is developed and implemented to increase the number of Canadians with knowledge of how to protect themselves against the risk of food-borne illness during an outbreak; develop a model for public health resources.

The Public Health Agency of Canada (PHAC), in consultation with Health Canada and the Canadian Food Inspection Agency (CFIA), developed a Food-borne Illness Emergency Response Plan (FIERP) to guide the response to an extraordinary situation when regular food safety procedures are insufficient and resource capacity is exceeded. The Plan builds on the Food-borne Illness Outbreak Response Protocol (FIORP) (2010) and uses an incident management structure and a set of emergency response support systems within the Health Portfolio Emergency Operations Centre to manage the outbreak.

The Outbreak Management Division in PHAC identified key partners within PHAC, as well as at Health Canada and CFIA, requiring training on the FIERP. These partners were invited to participate in a series of three separate but inter-related exercises to inform partners of the FIERP and to validate the Plan, and 100% of those invited participated in these exercises. To ensure ongoing readiness and engage as many federal food safety partners as possible, additional FIORP and FIERP exercises are currently being planned for fiscal year 2012-13.

PHAC also developed a Strategic Risk Communications Plan on Food Safety. Target audiences include at-risk groups as well as the general population. Under the Plan, PHAC expanded its web content to include plain language information about how outbreaks are investigated and how people can protect themselves against illness. PHAC also developed messages specific to certain pathogens and targeted to certain populations, for use during outbreaks.

Evaluation of the Plan would take place during or immediately following a widespread multi-jurisdictional outbreak of food-borne illness. The performance indicator for this activity was put in place in 2009 and, since that time, Canadians have not experienced an outbreak significant enough to provide meaningful data for use in an evaluation

Disease and Injury Prevention and Mitigation

Food-borne, Environmental and Zoonotic Diseases

$2.8M

$1.5M

$1.5M

Exercise the FIORP with federal/ provincial/ territorial partners.

Following endorsement of the revised FIORP in June 2010, a series of exercises were conducted to ensure a clear understanding of roles and responsibilities by food safety partners. Bilateral exercises were held with each province and territory from January to April 2011. In addition, national multi-lateral exercises of the FIORP involving all Federal, Provincial and Territorial partners were held March 22 and 23, 2012. Overall, 100% of the planned FIORP exercises were successfully completed.

In addition to these exercises, a total of six post-outbreak reviews have been held since the FIORP was finalized in June 2010. Three of these were held in the 2010-11 reporting period, with the additional three taking place in 2011-2012. Of these post-outbreak reviews, 100% have been positive. Comments received have been constructive and supportive of the Public Health Agency of Canada's leadership in outbreak investigation activities.

Regulatory Enforcement and Emergency Response

Health Emergency Response Team

$3.3M

$1.5M

$1.1M

Public health professionals in National Food-borne Illness Surge Capacity are trained and ready to respond to a food-borne illness outbreak activities in Canada.

The Office of Public Health Practice at the Public Health Agency of Canada (PHAC) developed and tested a pilot Public Health Reserve (PHR) model, a first step in development of a full roster, of epidemiologists, external to the Health Portfolio, to bolster capacity during food-borne illness outbreaks and other public health events.

Through the pilot PHR activities, it was determined that PHAC should pursue a number of initiatives to strengthen internal food safety response capacity, including an Integrated Surge Capacity Operational Framework to identify and support internal resources that can be further trained to support surge capacity requirements for response.

A PHAC- wide skill survey was implemented, which helped identify existing resources available to support a number of Agency gaps and define resource and training gaps within the Agency that would need to be addressed to best support a food-borne illness outbreak, ultimately forming part of the full roster. Approximately 120 people were identified on the surge capacity roster and approximately 50% of those were trained and are ready to respond to a food-borne illness outbreak identified within Canada.

Subtotal PHAC

$17.7M

$8.0M

$6.6M

Federal Partners

Federal Partner Program Activity

Names of Programs for Federal Partners

Total Allocation (from Start Date to End Date) ($ units)

2011-12 ($ millions)

Planned Spending

Actual Spending

Expected Results

Results Achieved

Health Canada (HC)

Food and Nutrition

Internal Services

Build health risk assessment capacity

$4.9M

$2.1M

$1.8M

HC will continue to enhance its ability to provide risk assessments, based on the best available science and risk modeling methods to strengthen prevention and response to food safety incidents.

Health Canada hired two additional indeterminate specialized experts, trained and cross-trained current staff to conduct health risk assessments (HRAs), and enhanced the procedures used by Health Canada's Food Safety & Nutrition Program's to support the CFIA during its food safety investigations. A total of 343 HRAs were conducted within established service standards (less than 8 hours for the highest risk category of assessments.) Health Canada continued to validate risk modeling methods and implement appropriate systems to facilitate the sharing of analyses and data across jurisdictions as well as to validate risk assessment approaches.

Health Canada finalized and posted its update of the 2004 policy on Listeria monocytogenes in Ready-to-Eat (RTE) foods, to enhance the control of Listeria in high-risk foods. The purpose of this policy is to provide guidance to stakeholders regarding verification and control, and regulatory oversight and compliance activities of RTE foods with respect to their potential to support the growth of Listeria monocytogenes. This policy, developed as a joint effort between Health Canada, the Canadian Food Inspection Agency, and the Public Health Agency of Canada, takes into account the respective roles and responsibilities of industry, government and consumers.

Improve test detection methods for Listeria and other foodborne hazards

$3.6M

$1.5M

$1.6M

HC will continue to have a suite of rapid, validated tools available to industry and government partners, to allow action to be taken at the earliest opportunity, reducing the exposure of Canadians in a food safety emergency.

Health Canada continued to pilot and validate methodologies and prototypes for the detection of Listeria and other hazards in food.

15 new methods related to Listeria monocytogenes detection were posted in the Compendium of Methods. The outstanding Official Methods have been prioritized for an orderly update of the Compendium. Health Canada continued to collaborate with the CFIA to review all the Official Methods for food hazards, posted or not posted, to determine if the methods are still valid, fit for purpose and still usable in modern laboratories. Health Canada has been active in the international harmonization of method validation procedures. The focus has been on synchronizing standards set by Health Canada, USDA and ISO. Health Canada scientists made significant contributions to the last annual meeting of the AOAC (Association of Official Analytical Chemists), by supporting the development of harmonized protocols for the validation of qualitative methods for microbiology and chemistry testing.

Health Canada continued to develop rapid methods for purification and screening of priority toxins, including mycotoxins, phycotoxins and process induced toxins in food and feed stock. A test kit for acrylamide was developed and validation has been completed for a subset of relevant food commodities.

Antibodies for natural toxins were also developed. These will be used in the development of a test kit.

Social Marketing Strategy

$2.0M

$0.4M

$0.4M

HC will deliver the third year of the Safe Food Handling social marketing strategy to three at-risk groups: adults 60+, pregnant women and people with compromised immune systems building awareness among these groups that they are at higher risk for complications and why, and communicating safe food handling practices specific to their needs.

Health Canada prepared News Canada Print, TV, Radio and web news stories specific for each audience (adults 60+, pregnant women, and people with compromised immune systems), in addition to some general information on safe food handling. To date there have been over 6 million impressions from the print articles alone.

Health Canada achieved specific results for the following audiences:

Adults 60+:

- 400,000 inserts were included in Old Age Security cheque mailing. - 3 million tear sheets were distributed through health professionals, pharmacies and Canada Post retail and postal outlets informing the audiences why they are at-risk for complications and instructions on how to order their complete Guide.

Compromised Immune Systems

- Articles and print ads were included in targeted publications, such as Canadian Health Magazine/ Santé Canadienne - 3 million tear sheets were distributed through health professionals, pharmacies and Canada Post retail and postal outlets informing the audiences why they are at-risk for complications and how can order their complete Guide.

Pregnant Women

- Articles and print ads appeared in targeted publications, such as Expecting/ C'est pour quand - Strategic Alliance with Thyme Maternity which included:

- 150,000 Guides were distributed at point of purchase in their 76 stores nationally - Print article/ ad appeared in their magazine - 60,000 Bag-stuffers directed customers to the healthycanadians.gc / food safety web site. - Intriguing mirror clings in the change-rooms directed customers to get their Guide at the cash (targeted customers not making a purchase in addition to those that were). - Two different e-mails sent to Thyme's 90,000 subscribers directed people to the web site and to order their Guide. Open rate of emails – Of the 27% who opened e-mails, 80% went to the on-line Guide and 14% requested a free copy of the Guide - Four different Facebook posts on the Thyme Facebook page directed the audience to the healthycanadians.gc / foodsafety web site.

Subtotal HC

$10.5M

$4.0M

$3.8M

Total

$75.0M (2009-10 to 2011-12)

$30.5M

$26.8M

Comments on Variances:

CFIA: Not Applicable

PHAC: The variance is attributable to the early completion of some activities, as well as lower than expected costs.

Invasive alien species (IAS) are those species introduced by human action outside their natural distribution (past or present), that threaten the environment, economy, or society, including human health. Annually, IAS causes billions of dollars in direct losses, control costs, increased production costs and lost market access. The annual impact of IAS is estimated to be as much as $20 billion to the forest sector, $7 billion for aquatic invasive species in the Great Lakes, and $2.2 billion for invasive plants alone in the agricultural sector. IAS have gained international attention as globalization, climate change, and increases in international trade have elevated the risks of IAS introductions.

In recognition that responding to IAS is a shared responsibility, "An Invasive Alien Species Strategy for Canada" was adopted in 2004 by federal, provincial and territorial resource ministers as a national coordinated approach toward prevention and management of IAS. The objective of the Strategy is to initiate implementation of the priority objectives (i.e. prevention, early detection and rapid response to new invaders and management of established and spreading invaders) and will be met through contributions to work in five thematic areas: Risk Analysis, Science and Technology, Legislation, Regulation and Policy, Engaging Canadians and International Cooperation. Environment Canada is the lead for invasive animal species; the Department of Fisheries and Oceans leads the aquatic invasive species issues; the Canadian Food Inspection Agency leads for invasive plants and other plant pests; and, Natural Resources Canada leads for forest pests.

Budget 2010 allocated $19 million per year to Environment Canada, the Department of Fisheries and Oceans, National Resources Canada and the Canadian Food Inspection Agency (CFIA) to continue implementation of the Government of Canada's IAS Strategy as well as maintain and enhance the advances made in the previous five years in invasive alien species activities. Ongoing implementation of the IAS Strategy is critical to continue the protection of Canada's ecosystems and resource-based economy.

Shared Outcome(s): Continuing the implementation of the Invasive Alien Species Strategy for Canada is essential to protect Canada's aquatic and terrestrial ecosystems and their native biological diversity as well as domestic plants and animals from the risks of invasive alien species. The key outcomes of the Strategy are the prevention and management of IAS in a manner that ensures environmental sustainability, economic competitiveness and societal well being.

Governance Structure(s): The government-wide IAS Strategy involves the Department of Fisheries and Oceans, Environment Canada, Natural Resources Canada and the Canadian Food Inspection Agency. The departments and agencies are committed to ongoing collaboration on IAS issues. Federally, coordination continues to be discussed through the Directors' General Interdepartmental Committee on Invasive Alien Species. Currently, the governance model for the National IAS Strategy is under revision. Nevertheless, inter-jurisdictionally, federal-provincial-territorial (FPT) cooperation on IAS issues continue under the auspices of the annual joint meeting of Resource Ministers' Councils for wildlife, forests, fisheries and aquaculture, and endangered species, as well as associated meetings of Deputy Ministers and Assistant Deputy Ministers. The Minister of Agriculture is the lead federal Minister responsible for responding to invasive alien plants and plant pests. Efforts will continue to seek the full engagement of federal, provincial, and territorial Ministers of agriculture and facilitate their participation in addressing invasive alien species.

Performance Highlights: The Departments of Fisheries and Oceans Canada, Environment Canada, Natural Resources Canada and the Canadian Food Inspection Agency continue to implement their respective contributions to the National IAS Strategy, as per the submission to Treasury Board. Work toward meeting the objectives of the Strategy resulted in the initiation and advancement of key projects within the thematic areas for each partner as specified in section 18 of the tables. Notable among cooperative projects between and among the groups were the initiation of a decision support framework for forest IAS (FIAS) as a joint endeavour between the CFIA and NRCan, initial review of Invasive Alien Species Partnership Program (IASPP) proposals for the 2011-2012, and implementation of the national Invasive Plants Early Detection and Rapid Response plan. Engagement with other governments (federal, provincial, territorial, municipal and international), partners and stakeholders was enhanced.

Federal Partners

Federal Partner Program Activity

Names of Programs for Federal Partners

Total Allocation (from Start Date to End Date) ($ units)

2011-12 ($ millions)

Planned Spending

Actual Spending

Expected Results

Results Achieved

Canadian Food Inspection Agency (CFIA)

Plant Resources Program

Internal Services

Risk Analysis

$15.5M (2010-11 to 2014-15) and $3.1M ongoing

$3.1M

$2.3M

Outcome 1: Entry of invasive plants and plant pests is managed in a risk based manner and domestic spread of invasive plants and plant pests is controlled.

The CFIA continued to identify highest risk potential IAS, their pathways, and appropriate means by which to mitigate identified risks through conducting pest and weed risk analyses, implementing import controls and initial response to early detections.

The Agency continued to facilitate information sharing among federal departments to ensure information flows among both departments, thereby ensuring CFIA's mandate is met.

The CFIA completed 46 pest risk assessments (insects, fungi, nematodes, viruses) and related technical evaluations, in support of the Plant Business Line in 2011-12.

Assessments were completed for forest pests, pests of grains and field crops, pests threatening the horticulture sector, invasive plants, newly proposed imports of commodities and new crops, and the science advice provided was incorporated into delivery, renewal or development of plant health policies and programs and negotiations between Canada and its international trading partners.

Weed risk assessments were conducted on potential quarantine pests, to analyze their ability to establish, spread and cause harm. These risk assessments were conducted to ensure the ongoing protection of agriculture and ensure ongoing market access to Canadian commodities. The CFIA completed 41 preliminary assessments of plant species for their potential to be quarantine pests, as well as six full weed risk assessments and two commodity risk assessments for the potential of containing seeds of quarantine pests.

Weed risk assessments were conducted to ensure that species intended for cultivation, such as Russian dandelion, would not harm Canada's plant resource base, agriculture, sustainable production or the environment that sustains the plant resource base.

The CFIA provides the secretariat role for the National Early Detection Rapid Response working group. The purpose of the National EDRR Working Group is to develop and implement an early detection rapid response model for invasive plants in Canada that can inform national, provincial and territorial strategies. The second objective is to identify existing resources. Currently, the national EDRR working group includes participants from Federal and Provincial government and representatives from provincial IS/IP councils, however, membership is open to all. Discussion during fiscal year 2011-12 focussed understanding control options available provincially and federally and the regulatory process involved with implementing some of the control options

Continued development of the Risk-Based Decision Support Framework with Canadian Forest Service and consultation with several provincial partners.

The CFIA organized and delivered pest risk assessment training courses for the province of British Columbia.

Science and Technology

$33.0M (2010-11 to 2014-15) and $6.6M ongoing

$6.6M

$3.6M

Outcome 1: Entry and domestic spread of invasive plants and plant pests is managed and response to invasive plants and plant pests is planned and implemented.

The Agency continued to support IAS prevention, detection and response through continued efforts to develop scientific tools and expertise.

The CFIA minimized the impact of IAS introductions with continued foresight projects and efforts in early detection such as import monitoring and inspection, continuing to develop diagnostic methods and tools for the identification of high risk IAS and that provide rapid and accurate identification of invasive alien species.

The CFIA conducted 21 plant pest surveys in 2011. These included pests in Horticulture, Forestry, and Invasive Plants, and a diverse array of taxa such as viruses, insects, fungi and nematodes. In many cases the surveys targeted specific regulated organisms but some surveys, such as the invasive forest insect survey and the invasive plants survey, focused on risk pathways in order to detect a range of pests. These surveys support regulatory decisions, import and export policies and large eradication and control programs, such as Asian Longhorned Beetle response. In some cases, the surveys are collaborative efforts, integrated with Provincial and municipal partners.

As part of the CFIA's foresight efforts and to provide programs/risk assessment with information on potential invasive species and provide laboratories with reference specimens to assist future diagnosis, the CFIA has engaged in various international collaborations (e.g., China).

In conjunction with the USDA Forest Service and the Northeast Forestry University (Harbin, China), a sentinel tree monitoring program was established in China to determine pests of maple, poplar and oak that could be potentially introduced into Canada. These three groups of trees are the most prevalent trees throughout all high risk areas regions of Canada and were thus chosen for the study. This project will assist programs and risk assessment in pro-actively identifying potential invasive threats and developing appropriate regulatory measures to prevent their introduction. It will also provide reference specimens to CFIA plant laboratories which will enhance diagnostic capabilities and reduce reliance on international diagnosticians. Lastly, this sentinel tree program will also provide a clear list of target pests to conduct detection surveys for invasive alien species.

Twenty-six internally funded Plant research and development projects were conducted in 2011-12 to develop new detection and identification methods, tools, and high-throughput diagnostic protocols for plant pests and the differentiation of crop varieties

Weed seed analysis requests for issuance of phytosanitary certificates continue to increase each year and is exceeding SSTS capacity to conduct the tests. The ASD program to recognize Accredited Seed Labs to conduct weed seed analysis for phytosanitary certification of Canary seed destined to Mexico was developed and made known to Accredited Seed Labs in the 2010-2011 fiscal, but the work of determining if the interested labs could be recognized to conduct the testing was completed in the 2011-2012 fiscal.

Scientific research projects related to IAS prevention and control for eg.CFIA collaborated on a project to develop devegetation and revegetation options for erosion prone sites infested with invasive plants using kudzu as a test case.

4 new areas were reported with detections of Emerald Ash Borer (2 in Ontario, 2 in Quebec) in 2011-2012.

1 Potato Rot Nemotode (Ditylenchus destructor) detection in Ontario.

First detection of Brown Spruce Longhorn Beetle (Tetropium fuscum) confirmed in New Brunswick.

Legislation, Regulation and Policy

$6.0M (2010-11 to 2014-15) and $1.2M ongoing

$1.2M

$0.3M

Outcome 1: Entry and domestic spread of invasive plants and plant pests is managed and response to invasive plants and plant pests is planned and implemented.

The Invasive Alien Species Program is an ongoing program involving the whole Plant Business Line as well as Federal, Provincial and Territorial partners and industry stakeholders who have been and will continue to be routinely engaged.

The Invasive Plants Policy was posted on the CFIA external website on February 21, 2012.

The domestic regulatory measures for woolly cup grass were revised in Quebec for implementation in 2012 growing season.

Continued development and implementation of domestic control programs for jointed goatgrass, kudzu and Echium.

Continue to develop an implementation plan for invasive plants/weeds/other IAS (Khapra beetle) in the grain pathway.

The Agency continued modernizing the legislative framework and harmonizing approaches, where possible, in consultation with stakeholders. To ensure consistency with international standards and legislated mandate, the CFIA will continue to develop new science-based program policies and update existing ones with a focus on higher risk pathways of introduction.

The Agency continued to design new programs and modernize existing ones to support the implementation of policies and to deliver associated import control to protect Canada's resource base from potential IAS.

The CFIA is partnering with provincial government representatives to develop response plans for invasive plants which are federally regulated or under consideration for federal regulation and present domestically. Species specific response plans and/or directives are currently under development for Eriochloa villosa (woolly cupgrass), Aegilops cylindrica (jointed goatgrass), Echium plantaginareum (Paterson's curse) and Pueraria montana (kudzu). For example, the CFIA has a well-established partnership with the ministère de l'Agriculture, des Pêcheries et de l'Alimentation du Québec (MAPAQ). The CFIA and MAPAQ are working with the parties affected by woolly cupgrass infestations in Quebec to identify reasonable solutions and acceptable risk mitigation measures that adhere to the domestic phytosanitary requirements.

Engaging Canadians

$3.5M (2010-11 to 2014-15) and $0.7M ongoing

$0.7M

$0.5M

Outcome 1: Increased cooperation and awareness from stakeholders on plants and plant pests and compliance with policies and regulations.

A communication plan was developed by the CFIA in May 2011. This included material such as, an Invasive Plants Field Guide, promotional gardening gloves, 19 invasive plant fact sheets and a general invasive plants fact sheet. This public awareness material was developed throughout the 2011-12 fiscal year and printing was completed in March 2012.The intended audience for this material included CFIA internal staff, other governmental departments (federal, provincial, territorial and municipal), as well as industry stakeholders (agricultural, horticultural), importers of plant products, gardeners, crop advisors, agronomists, weed specialists, field naturalists, academia, international partners, the Canadian public and the media. This material was developed to increase the awareness of invasive plants among industry stakeholders, CFIA inspection staff and the public. It was also used to educate the public of the role they can play in helping to keep these invasive plants out of Canada by assisting the CFIA in determining the presence and distribution of invasive plants that are or will be regulated by the CFIA. This material also increased the visibility of actions being taken by the CFIA to protect the environment and economy in Canada.

Invasive Plants Field Guides were developed and distributed to provincial representatives and stakeholders to assist with surveys.

The CFIA hosted face to face meetings with producers, importers, processors and provincial weed specialists to maintain and enhance support for and innovations for implementation of the import program to prevent IAS in various pathways.

Continue to collaborate with the Grains and Oilseed Section to consult with the Canadian grain industry on the feasibility and implementation of end-use, risk-based pilot import plan for the grain pathway.

The Agency continued to work collaboratively with stakeholders and other government departments to raise awareness about IAS, their potential pathways and associated policies and programs, thereby promoting early reporting of IAS, best management practices and compliance with regulations for reducing the risk to Canada's plant resources.

The invasive plants fact sheets have been shared with the public on our external CFIA webpage. Hard copies of the fact sheets and gardening gloves were distributed to the public at Canada Blooms in March 2012. Fact sheets were also distributed to CFIA area network specialists for further distribution to provincial and invasive species council representatives.

CFIA staff routinely delivered presentations to Invasive Plant/Species council members - eg. Presentation on Invasive Plant Program delivered at the Ontario Invasive Plant Council meeting in October 2011.

National IAS Forum - CFIA staff were on the organizing committee for this forum and also provided several presentations related to invasive species generally and to invasive plants more specifically (Ottawa, February 2012)

The CFIA attended the Canada Blooms - a 10 day event staffed by Plant Health and Public Affairs staff in Toronto, Ontario (March 2012). This is an event attended by thousands. CFIA staff provided information and answered questions related to IAS and to invasive plants specifically for the duration of the event. Promotional material for invasive plants and for the "Don't Move Firewood" campaign was distributed.

Media interview with Capital Online - November 2, 2011 Journalist student conducted a recorded interview to be used in a multimedia feature on the Web. CFIA staff was interviewed to discuss IAS and the CFIA's role.

The CFIA continued to collaborate with federal and provincial partners to co-ordinate implementation of An Invasive Alien Species Strategy for Canada, to maintain strong lines of communication, engage stakeholders, and contribute to good interdepartmental governance as well as strengthening internal governance across branches.

The CFIA participated, in an advisory capacity, on the board of several Invasive Plant/Species Councils. Provincial councils have been created across the country to provide leadership, co-ordination, expertise and a forum to engage Canadians on Invasive Species. Membership in the councils is open to all and includes participation from Federal, Provincial and Municipal government, industry, academia, environmental groups and the general public. While most of these councils address the broad scope of invasive species, the councils of Ontario and Alberta currently focus on Invasive Plants.

The CFIA actively participates, along with DFO and NRCan, on the Operations Committee of the Invasive Species Centre (ISC) in Sault. Ste. Marie. The ISC provides a forum for sharing information and coordinating research necessary for implementing the National IAS Strategy. The centre focuses mainly on IAS with an impact on forestry and the aquatic environment. The CFIA works with the centre to identify suitable projects and student candidates for internship program that will help the CFIA advance key IAS activities.

The Agency also participates in working groups with the provinces (i.e., Ontario critical plant pest management working group) and advisory committees (i.e., British Columbia Plant Protection Advisory Committee (BCPPAC) and the Ontario Plant Pest Management Committee).

International Cooperation

$2.0M (2010-11 to 2014-15) and $0.4M ongoing

$0.4M

$0.1M

Outcome 1: Increased international engagement, cooperation and awareness of invasive species and compliance with policies and regulations.

One of the main goals of international cooperation is to ensure that international standards and processes reflect Canadian interests. The CFIA continued its active participation in international standard setting, harmonization of approaches, negotiations and bilateral meetings with key trading partners to mitigate the risk of IAS introduction through trade pathways and maintain access to foreign markets.

Collaboration is fostered through active participation in scientific activities and knowledge transfer in support to international phytosanitary organizations such as the North American Plant Protection Organization and the International Forestry Quarantine Research Group that provides internationally coordinated research analyses to the International Plant Protection Convention's Technical Panel on Forest Quarantine and Commission of Phytosanitary Measures.

The CFIA is an active member of various QUADS working groups (i.e. international committees representing USA, New Zealand, Australia and Canada). Two of these working groups, Asian Gypsy Moth and Survey Lures and Protocols, are excellent vehicles for sharing methods in the prevention and detection of invasive alien species.

Various institutions in Australia, New Zealand and the United States collaborated with the CFIA on scientific and technical projects of mutual interest (eg. Asian Gypsy Moth).

Collaborated with the United States Department of Agriculture (USDA) on risk assessment methodologies for invasive plants. Officers from the CFIA have been trained and developed expertise in the USDA weed risk assessment methodology with the capacity to share components of the weed risk assessment. Risk assessors from the CFIA have also participated in two European Union projects to improve risk assessment methodologies and compare effectiveness of models from Canada, Australia, and the European Union. The projects, known as 'Pratique" (EPPO) and "Prima Phacie" (EFSA) have produced an extensive evaluation of best practices and incorporated Canadian experience in the process.

Ongoing discussions with the USDA are taking place regarding a collaborative approach to invasive plants from off-continent.

The CFIA is in ongoing discussions with the USDA on end-use risk based import requirements to limit the introduction and spread of woolly cup grass in grain commodities imported from the US. The target for the implementation of a pilot is August 1, 2012.

Subtotal CFIA

$60.0M (2010-11 to 2014-15) and $12.0M ongoing

$12.0M

$6.8M

Federal Partners

Federal Partner Program Activity

Names of Programs for Federal Partners

Total Allocation (from Start Date to End Date) ($ units)

2011-12 ($ millions)

Planned Spending

Actual Spending

Expected Results

Results Achieved

National Resources Canada (NRCan)

Adapting to a Changing Climate and Hazard Risk Management

Risk Analysis

$3.0M (2010-11 to 2014-15) and $0.6M ongoing

$0.6M

$0.6M

Outcome 1: The capacity to identify and address forest invasive alien species risks and prevent their introduction is increased.

NRCan continues to develop integrated models and maps that inform decision makers about risks and impacts of introduction and spread of forest invasive alien species. Contributions in this area support survey, monitoring and control/mitigation programs of responsible regulatory agencies. Examples of achievements include:

- Risk analysis of trade-associated pathways (marine trade and commercial road transportation) for forest invasive insect entry into Canada. - A modeling tool to estimate introductions through movement of firewood and recreational travel of invasive pests. - National estimates of costs to Canadian municipalities of emerald ash borer.

Outcome 2: Likelihood of establishment or spread of forest alien forest species is minimized and their impacts are mitigated.

Knowledge, tools and advice are provided to members of the forest sector to assist decision makers in the early detection and identification of forest invasive alien species, and in providing rapid responses to them. Examples of achievements for outcome 1 and 2 include:

- Collaboration with Ontario Ministry of Natural Resources, Quebec's Ministère des Resources naturelles et de la Faune and the Canadian Food Inspection Agency (CFIA) actions to slow the spread of the emerald ash borer. - A strategy for emerald ash borer control in urban sites - Development of a rapid and efficient detection tool for alien fungi. - A new tool for rapid detection of emerald ash borer. - Development of new methodology in the project to save butternut from extinction due to an introduced disease. - Completion of a new alien pest insect production and Level-two quarantine facility in Sault Ste. Marie.

Legislation, Regulation and Policy

$1.0M (2010-11 to 2014-15) and $0.2M ongoing

$0.2M

$0.2M

Outcome 1: Decision-making related to forest invasive alien species management by regulatory agencies and other organizations is informed by scientific and policy expertise.

Outcome 2: Canadian positions in national and international discussions on phytosanitary trade issues are informed by scientific and policy expertise.

- The Asian long horned beetle has been effectively eliminated from Toronto by the CFIA due in part to the research, advice and activities of NRCan. This knowledge is now being applied to new outbreaks in the United Sates and United Kingdom. - Continued development of a Decision-Support Framework for forest invasive alien species with the CFIA, provinces and territories. - Establishment of an interdepartmental working group ensuring diligent follow-up on risk analyses, research needs and knowledge transfer related to priority pathogens. - Continued participation in the Canadian Forestry Phytosanitary Working Group, input into the development of Canadian forest sector strategies to reduce international trade barriers for forest products.

Engaging Canadians

$0.5M (2010-11 to 2014-15) and $0.1M ongoing

$0.1M

$0.1M

Outcome 1: Scientific information on FIAS is made available to agencies, researchers and the public.

Outcome 1: International cooperation with phytosanitary organizations and trading partners is facilitated.

NRCan continues to provide research and science advice to international and intergovernmental organizations in support of phytosanitary standard development and trade negotiations. Examples of achievements include:

- Continued provision of advice to the International Plant Protection Convention's Technical Panel on Forest Quarantine in support of the publication of new international phytosanitary standards. - Continued provision of policy advice, research results and analysis to the North American Plant Protection Organization in support of new regional phytosanitary standards. - Provision of scientific analyses to address phytosanitary concerns of the Republic of Korea (relating to the import of Canadian pine timber).

Subtotal NRCan

$10.0M (2010-11 to 2014-15) and $2.0M ongoing

$2.0M

$2.0M

Federal Partners

Federal Partner Program Activity

Names of Programs for Federal Partners

Total Allocation (from Start Date to End Date) ($ units)

2011-12 ($ millions)

Planned Spending

Actual Spending

Expected Results

Results Achieved

Department of Fisheries and Oceans (DFO)

Science for Sustainable Fisheries and Aquaculture

Internal Services

Risk Analysis

$2.0M (2010-11 to 2014-15) and $0.4M ongoing

$0.4M

$0.4M

Outcome 1: Risk analysis for priority species and pathways

Bi-national risk assessment on bigheaded carps completed

Zebra and Quagga Mussels risk assessment completed

Peer-reviewed risk assessment finalized for the ship-mediated pathway (ballast and hull-fouling vectors) in Atlantic and Pacific

Outcome 1: Decision makers are provided with information in order to manage species and pathways in a risk based manner.

Ongoing funding for science monitoring and research activities to identify (1) trends and status in presence, abundance, and ranges of new and existing AIS; (2) ecological impacts; (3) pathways of introduction and spread; etc, leading to publications including those in primary literature and updated information on species occurrence in DFO's Aquatic Invasive Species National Database.

Research on impacts of tunicates on native species, impacts of green crabs on native ecosystems,

Continuing evaluation and refinement of ballast water management techniques in concert with Transport Canada

Contribution to the Canadian Aquatic Invasive Species Network through support of sampling teams and research projects.

Legislation, Regulation and Policy

$1.05M (2010-11 to 2014-15) and $0.21M ongoing

$0.21M

$0.22M

Outcome 1: Development of components of aquatic invasive species regulations

Input from provincial/ territorial partners, OGDs and DFO regional staff has been received and integrated in the regulatory intent document and a regulatory outline which describes components of the AIS regulatory proposal (including a definition, a list of AIS, prohibitions, authorizations, and control and eradication activities).

Regular meetings held with provinces/territories to discuss AIS issues though the National Aquatic Invasive Species Committee including a face to face meeting in Ottawa.

Evaluation of existing Biological Risk Assessment Framework to identify the risk posed by AIS and to inform the listing process.

Consultation plan has been drafted in collaboration with provincial/territorial partners and DFO regional staff for further consultations with stakeholders. Public consultations are expected to take place during the summer of 2012.

Engaging Canadians

$0.45M (2010-11 to 2014-15) and $0.09M ongoing

$0.09M

$0.072

Outcome 1: Stakeholder and partner are aware of activities that can mitigate the risk of aquatic invasive species

Developed and distributed various communication products such as identification booklets, Signs, posters, fact sheets and other public education materials throughout Canada.

International Cooperation

$11.4M (2010-11 to 2014-15) and $2.28M ongoing

$2.28M

$2.27M

Outcome 1: The impact of Sea Lamprey is effectively managed in the Great Lakes

Outcome 2: Canada is engaged with international discussion to address the introduction and spread of aquatic invasive species.

DFO effectively delivered the Sea Lamprey Control Program in Canadian waters of the Great Lakes and US waters of Lake Ontario, as part of Canada's commitment to a bi-national initiative administered by the Great Lakes Fishery Commission. This included: lampricide treatment of sea lamprey populations in 42 tributaries and 11 lentic areas, including 873 ha of the St. Marys River; conducting larval surveys on 161 tributaries and 17 lentic areas; operating and maintaining 25 sea lamprey barriers, and; operating spawning-phase traps at 19 sites.

Working with the Great Lakes Fisheries Commission, Canadian and American experts have worked together to complete a risk assessment of the threat of Asian carps in the Great Lakes. The CSAS peer-reviewed risk assessment and supporting research documents provides a state-of-the-science assessment of the risk of entry, establishment, spread, and impact of Silver and Bighead carps. Department leadership resulted in international consensus on this critical science.

DFO participates in and contributes to various international working groups that focus on Aquatic Invasive Species. Canada coordinates with the United States through the Aquatic Nuisance Species Task Force. Canada also participates in aquatic invasive species at the International Council for the Exploration of the Sea (ICES-Atlantic) and the North Pacific Marine Science Organization PICES.

Subtotal DFO

$20.0M (2010-11 to 2014-15) and $4.0M ongoing

$4.0M

$4.0M

Federal Partners

Federal Partner Program Activity

Names of Programs for Federal Partners

Total Allocation (from Start Date to End Date) ($ units)

2011-12 ($ millions)

Planned Spending

Actual Spending

Expected Results

Results Achieved

Environment Canada (EC)

Biodiversity - Wildlife and Habitat

Engaging Canadians

$5.0M (2010-11 to 2014-15) and $1.0M ongoing

$1.0M

$1.0M

Outcome 1: Increased number and quality of proposals

Outcome 2: Increased contribution of individuals and organizations in activities related to IAS

Note: 2011-2012 was the first year that projects were funded under the second phase of the IASPP; therefore, this is the first year of collecting baseline data against the expected results.

- 130 IASPP proposals were received. - The mean proposal evaluation score based on several criteria and a grid was 69% - From the 29 funded IASPP projects, the total individual involvement (paid staff and volunteers) was 6,339 person-days. - Contributions (cash and in-kind) from the 29 recipients and their partners was $2.6M.

Subtotal EC

$5.0M (2010-11 to 2014-15) and $1.0M ongoing

$1.0M

$1.0M

Total

$95.0M (2010-11 to 2014-15) and $19.0M ongoing

$19.0M

$13.8M

Comments on Variances:

CFIA: The expected results for each of the programs are on-going and are in various stages – initiation, development, validation, implementation, re-evaluation. In 2011-2012, as expected, the CFIA did deliver on activities in each of the five thematic areas commensurate with the resources spent on IAS. The variance between IAS funding allotment and spending on specific IAS activities comprises $2.6 million in Corporate overhead and an additional $2.6 million allocated to Agency priorities that support the CFIA's mandate which, in turn, has bearing on development and delivery of the CFIA's IAS Program.

NRCan: Not Applicable since full allotment was expended

DFO: Not Applicable since full allotment was expended.

Environment Canada: Not Applicable since full allotment was expended.

Results to be achieved by non-federal partners (if applicable): Not Applicable

Plum Pox Virus (PPV) is a viral plant disease that infects Prunus species including peach, plum, apricots and other stone fruit plants. PPV does not affect human or animal health but reduces fruit yields, mottles leaves, and causes visual symptoms on stone fruit which thus reduces their marketability. The virus is spread locally by aphids (an insect) and through the movement of infected propagative material, including live trees of all age classes, rootstock, bud wood, cuttings or other green branches and twigs, and tissue cultures.

PPV was first discovered in Ontario and Nova Scotia in 2000. The Government of Canada responded in 2001 with a three-year, $49.3 million PPV program to suppress PPV, and to evaluate the feasibility of eradication. Based on the recommendations of a PPV International Expert Panel (IEP), the seven-year, Plum Pox Eradication Program (PPEP) was launched in 2004 ($85 million) and augmented in 2007 with an additional $58.6 million totaling $143.6 million in federal and Ontario government funding. The PPEP expired on March 31, 2011.

Eradication of PPV has been achieved in six of the seven quarantine areas established at the beginning of the eradication program. These six quarantine areas are Blenheim, Fonthill, Stoney Creek and Vittoria in Ontario, and the Annapolis Valley and Wolfville in Nova Scotia. All of the regions continue to be surveyed and monitored, and no new virus cases have been found outside the Niagara region. Although eradication was not achieved in Niagara, the infection rate has been reduced from 1.9% of tree samples to less than 0.02% in 2010.

By implementing a PPV monitoring and management strategy, PPV will remain in the Niagara region in perpetuity, thus the industry will need to manage the risks it poses to production and marketability of products.

The PPMMP consists of regulatory plant protection activities and, for the first five years of the program, significant research to develop PPV risk mitigation tools and educational and awareness program components to build the capacity within the industry to implement best management practices.

CFIA and Agriculture and Agri-food Canada (AAFC) funding was obtained from Budget 2011 which allocated $17.2 million over five years for the PPMMP, whose goal is to be a management and monitoring strategy to contain and prevent the spread of plum pox.

Shared Outcome(s): The outcome of the Government's PPMMP is to fulfill the Government of Canada's plant protection obligations and international responsibilities through measures to mitigate the spread of PPV to other regions of Canada and internationally. The PPMMP's other outcome is to facilitate industry management of PPV.

Governance Structure(s): The CFIA's PPMMP activities and deliverables are managed and governed by the Plant Health Business Line Committee as PPV is an established, regulated plant pest requiring ongoing decision making to protect Canada's plant resource base. Also, AAFC's A-Base activities are managed and governed by a committee of Science Directors from the Research Branch who report to the Director General (DG) of Science Operations. The DG has the final "sign-off" authority for AAFC Research Branch activities including PPMMP. An AAFC Science Director has been assigned as responsible for ensuring PPV research activities are implemented, managed and reported as required.

A PPV Steering Group (PPV-SG), consisting of CFIA and AAFC director-level officials, was established for the first five years to make recommendations about program delivery to the above CFIA and AAFC governance committees. The PPV-SG liaises with internal and external stakeholders as required, including international plant protection bodies, to provide updates and seek input about program and research parameters at stakeholder conferences and meetings. After a period of five years, when AAFC's role in the PPMMP has concluded, CFIA's Plant Health Business Line Committee will be responsible for managing the PPMMP on an ongoing basis.

Performance Highlights: For 2012/13, the key horizontal plans are: implement appropriate sampling and detection of Plum Pox Virus host material to update, as required, the quarantine area boundary; enforce restrictions to mitigate the spread of Plum Pox Virus; and undertake research activities to improve the regulatory program.

Federal Partners

Federal Partner Program Activity

Names of Programs for Federal Partners

Total Allocation (from Start Date to End Date) ($ units)

2011-12 ($ millions)

Planned Spending

Actual Spending

Expected Results

Results Achieved

Canadian Food Inspection Agency (CFIA)

Plant Resources Program

Internal Services

Monitoring and Detection

$4.2M (2011-12 to 2015-16)

$0.8M

$0.5M

Monitoring activities will be carried out to confirm and adjust the boundaries of the Niagara quarantine area as necessary. The CFIA will annually collect samples from commercial orchards, residential properties and nurseries from PPV-susceptible species along the Niagara quarantine area perimeter. Laboratory testing of the samples will be conducted to determine if PPV has spread beyond the quarantine area.

Samples were collected from the quarantine area perimeter and confirmed free from PPV through laboratory testing.

Regulatory Enforcement

$4.6M (2011-12 to 2015-16)

$1.0M

$0.9M

The CFIA will continue to enforce the prohibition on propagation within the quarantine area and movement of regulated material out of the quarantine area. Through inspection activities the CFIA will monitor and assess the compliance of regulated parties with the PPMMP regulatory requirements through audits for compliance verification of retail outlets, nurseries and other facilities.

Inspectors issued movement certificates for approved material following compliance verification of regulated parties. Information regarding the continued propagation ban was distributed through local newspapers and targeted audiences. Commercial production areas and residential properties were inspected to ensure compliance with the propagation ban. Inspectors issued Restriction of Activity/ Prohibition Notices to non-compliant individuals.

PPV Regulatory Research

$1.1M (2011-12 to 2015-16)

$0.3M

$0.3M

To support the clean stock program the CFIA will conduct research related to eliminating PPV from stock and characterizing the genetic variation of individual strains of PPV in Canada. These activities will also support surveillance, monitoring and detection activities.

Evaluation of effective and efficient methods for eliminating PPV and other viruses from infected stock is currently underway. This is a long term project and specific results will be forthcoming as the project further progresses. Canadian isolates of PPV detected in commercial orchards during the 2010 delimitation survey are being characterized molecularly in detail. Isolates analysed to date have been confirmed as members of the Dideron strain (one of many PPV strains found worldwide), and most isolates fall within the two known subgroups of PPV Dideron found in Canada.

PPV Suppression Research

$0.7M (2011-12 to 2015-16)

$0.2M

$0.1M

In collaboration with AAFC, the CFIA will assist in evaluating foreign Prunus material for use in Canada that may be tolerant to the effects of PPV.

Progress continuing through the identification of select foreign varieties. To date, three varieties from Germany have been received by the CFIA, Sidney Lab and are currently undergoing virus testing and pre-evaluation for desired characteristics. Budwood should be available to AAFC in 2013 for further evaluation.

Subtotal CFIA

$10.6M (2011-12 to 2015-16)

$2.3M

$1.8M

Federal Partners

Federal Partner Program Activity

Names of Programs for Federal Partners

Total Allocation (from Start Date to End Date) ($ units)

2011-12 ($ millions)

Planned Spending

Actual Spending

Expected Results

Results Achieved

Agriculture and Agri-Food Canada (AAFC)

Science, Innovation and Adoption

PPV Regulatory Research

$0.4M (2011-12 to 2013-14)

$0.1M

$0.1M

Research dedicated to improved detection through the development of more sensitive broad spectrum diagnostic tools for detecting PPV.

Research on isolation and purification of the helper component-proteinase (HC-Pro) protein initiated. Research studies have commenced with results expected in future years.

Virus Resistance Research

$3.0M (2011-12 to 2015-16)

$0.5M

$0.5M

Research will develop virus resistance strategies through the development of a new PPV resistant peach tree line through gene silencing; development of transferable resistance in rootstock that can be transmitted through grafting; and development of a virus vector which will act like a vaccine.

Progress continuing in all long-term projects. Research initiatives have continued from prior years with results expected by 2016.

PPV Suppression Research

$2.9M (2011-12 to 2015-16)

$0.4M

$0.4M

Research to reduce PPV transmission in orchards by assessing practices and processes to suppress PPV transmission by aphids through the use of oilsprays and newly registered insecticides. Evaluating the influence on tree variety and age on the level of seasonal resistance to natural infection by aphids. Will also examine the impact of PPV infection in both young and mature peach on tree growth, hardiness and productivity in subsequent years.

Extensive winter field surveys have identified 12 PPV-infected peach trees for use in ongoing studies. The screenhouse facility was modified and certified by the CFIA for holding PPV- infected trees. A protocol to evaluate the effects of insecticides on aphid transmission is being developed using potato virus Y (PVY) and turnip mosaic virus (TuMV) as a model system allowing for more rapid assessments. Research initiatives have commenced with results expected in future years.

Education and Awareness Activities

$0.3M (2011-12 to 2015-16)

$0.03M

$0.03M

Activities to increase industry knowledge and awareness of PPV management practices through the development and publishing of pamphlets, articles, fact sheets and web postings with information on the management of the virus and symptoms to Prunus Fruit producers. In 2015-16 AAFC will transfer the additional knowledge and specific recommendations to enhance best management practices that have been acquired through research projects.

Information posters were developed, printed and distributed to the local industry to assist in the identification of PPV symptoms. A best management practices guide for Prunus fruit producers has been printed and distributed to help the Prunus fruit industry manage the disease. An International Plum Pox Meeting was organized to obtain the latest information on plum pox management from around the world that will be used to manage the virus and slow down the spread of this disease.

Subtotal AAFC

$6.6M (2011-12 to 2015-16)

$1.03M

$1.03M

Total

$17.2M (2011-12 to 2015-16)

$3.33M

$2.83M

Comments on Variances:

Funding variances between 2011 planned and actual can be described as funding was received late in the fiscal year. Activities related to the PPMMP are carried out during the summer months with planning complete early in the fiscal year. Late receipt of funding resulted in a decreased number of planned FTE's and caused a decrease in the completion of the number of planned activities for the PPMMP.

Results to be achieved by non-federal partners (if applicable): Not Applicable

The CFIA was created in 1997 to enhance food safety systems through the consolidation of inspection and quarantine services that were being delivered by Agriculture and Agri-Food Canada, Health Canada, Fisheries and Oceans Canada and Industry Canada. The current inspection system comprises numerous independent inspection delivery models.

In Budget 2011, the Government of Canada committed funding amounting to $96.8 million to the CFIA to improve and modernize its food safety inspection system. A number of CFIA initiatives were identified to modernize Canada's food safety inspection system. In support of Agency modernization initiatives, Health Canada (HC) received $3.0 million of this funding for enhanced health risk assessment capacity.

The main objectives of this modernization initiative are to move the CFIA away from a system of independent commodity-specific inspection approaches and inspector training, and paper-based record keeping and interactions with stakeholders, to that of a single-inspection approach consistent across the food safety program, supported by standardized training, technology information solutions, enhanced proactive science capacity and improved service to stakeholders.

The plan consists of three elements:

inspection system modernization, including the development of an improved inspection model which will provide standardized activities across the food program, national training for inspectors, enhanced Listeria control in high risk, non-meat ready-to-eat foods, enhanced HC health risk assessment capacity in support of CFIA modernization activities, and the development of an electronic service delivery platform;

supporting risk-based decision making through enhanced scientific capacity, including a proposal for a food laboratory network, enhanced capacity for scientific testing and improved facilities and equipment; and

increasing efficiency through improved information management and information technology, including data storage and back-up capacity; enhanced connectivity and more support for inspector tools such as wireless devices, and laptops.

Shared Outcome(s): Modernize CFIA's inspection system by providing up-to-date and relevant training and necessary technology support. This shared outcome will address the increasing complexity of inspection associated with industry advancements in food production, and international advancements to improve food safety systems.

Governance Structure(s): The CFIA has imposed an internal governance framework for the delivery of activities related to Food Safety Modernization. The CFIA's Senior Management Committee, chaired by the President, will provide direction for initiatives, and is accountable for overall implementation. Three VP-level advisory committees responsible for each of the three elements (inspection system modernization, science and IM/IT) will report to the Agency's Senior Management Committee, and will be accountable for ensuring activities are on track and on budget. Each will operate individual governance structures, led by a business sponsor and a dedicated Project Manager, with representation from all implicated areas. The Project Governance and Investment Board provides the forum to ensure horizontal integration between the three elements.

Performance Highlights: For 2012-13, consultations will be held for the drafting of an improved food inspection model. Project approval will be sought for the IM/IT solution to support the implementation of the draft model, as well as the electronic service delivery platform. The electronic service delivery platform project team will develop the required project documentation for project approval, and work with stakeholders will be initiated to develop detailed business requirements. With respect to the implementation of Health Canada's Listeria policy for high-risk, non-meat ready-to-eat foods, the Agency will continue staffing actions to provide additional inspection staff for inspection activities in high-risk areas, validate new laboratory methodologies for Listeria in non-meat commodities, and analyze additional food and environmental samples. A new core training program will be piloted for new inspection staff. CFIA subject matter experts will also provide refresher training to existing staff to keep inspectors current with emerging trends and developments related to their work. Adjustments to the core training program will occur as the new inspection model is developed and refined. The Agency will strengthen its information integration capability by introducing Agency-wide data standards. Planning will commence for desktop operating system and tools upgrading and standardization, as well as increasing data storage and backup capacity.

To enhance scientific capacity in 2012-13, the CFIA will assemble a small team to work in collaboration with partners and explore with experts the concepts, processes and mechanisms available to conduct a laboratory systems analysis of the Canadian food laboratory system. Partners will be engaged in exploring data and information requirements and opportunities in anticipation of future feasibility assessments, with respect to the use of existing, or in the creation of an IM/IT platform for secure data sharing. The Modernizing Equipment and Laboratories sub-projects at the GTA and St. Hyacinthe Food laboratories will move into the Project Planning stage with the award of contracts for the Engineering/Design phase of the projects. This will provide support to move to the execution stage of the projects with construction beginning in 2013-14. Additionally, highly skilled scientists will be hired in targeted laboratories.

Federal Partners

Federal Partner Program Activity

Names of Programs for Federal Partners

Total Allocation (from Start Date to End Date) ($ units)

2011-12 ($ millions)

Planned Spending

Actual Spending

Expected Results

Results Achieved

Canadian Food Inspection Agency (CFIA)

Food Safety Program

Internal Services

Inspection Modernization

$100.2M (2011-12 to 2015-16)

$7.1M

$5.1M

Development of improved food inspection model

In the beginning of December 2011, the CFIA held a series of engagement sessions with unions, internal staff (including frontline staff) and industry stakeholders to initiate dialogue and improve understanding of inspection modernization.

In 2011-12, a dedicated team worked with inspectors, subject matter experts and industry to review current programs, identify and challenge current practices, and identify elements that are fundamental to a single and consistent approach to inspection across food commodities. By the end of 2011-12, there was a draft Improved Food Inspection Model which had been developed and validated by CFIA staff and senior management.

Undertake pre-planning work that will result in a submission to Treasury Board for project approval in year two.

Pre-planning work has started. A project team with CFIA subject matter experts started development of the High Level Business Requirements (HLBR) to assist in the identification of a preferred IT solution.

Enhance inspection and testing activities to verify industry control of Listeria in all high-risk, non-meat RTE food.

Implement a national approach to recruitment, closely linked with consistent, competency-based core training for inspection staff.

The Human Resources Branch continued the development of a 6 week core training program for new inspection staff, and delivering refresher training to existing staff.

Enhancing Scientific Capacity

$19.8M (2011-12 to 2015-16)

$0.9M

$0.9M

Identification of collaborative opportunities between partners and enhance the science expertise by hiring high skilled scientists.

Throughout 2011-12, the CFIA put in place an interim secretariat to coordinate the development of a strategy for an effective national food laboratory system. Activities such as a high level roadmap, procurement and engagement strategies as well as some Provincial outreach visits were completed. Highly skilled scientists were hired in Dartmouth and Ottawa.

Improved IM/IT

$16.8M (2012-13 to 2015-16)

$0.0M

$0.0M

Provide the Agency and Agency staff with stable and up to date information management and information technology and integration capabilities.

Strengthen risk assessment capacity including the operational capacity and technical expertise to provide 24/7 availability of health risk assessment teams in support of the CFIA's food safety investigations.

Not applicable for 2011-12

Subtotal HC

$2.6M (2012-13 to 2015-16)

$0.0M

$0.0M

Total

$139.4M (2011-12 to 2015-16)

$8.0M

$6.0M

Comments on Variances:

The Agency's actual spending was $2 million less than planned. Several initiatives experienced scheduling delays resulting in less funds required in 2011-12. The Agency Governance approved the carry-forward of unspent funds within the Inspection Modernization Program to align with revised schedules.

Health Canada: Not applicable for 2011-12.

Results to be achieved by non-federal partners (if applicable): Not Applicable

In June 2010, Canada hosted the G8 and G20 summits. The Group of Eight Heads of State (G8) met in Huntsville, Ontario, on 25th and 26th of June to discuss issues of mutual and global concern. This was immediately followed by the meetings of the Heads of State or Government of the G20 Countries and their finance ministers, in Toronto, to discuss topics pertaining to international finance matters.

The OAG examined the development of financial plans and budgets, funding requests, and recording of expenditures for the G8 and G20 summits, and whether the amounts spent were used for the intended purposes—for security, policing, organizing, and hosting of the summits. Funding for summit activities was divided among 14 departments of which the Canadian Food Inspection Agency was one.

Audit work for this chapter was substantially completed on 17 December 2010.

Agency Response: No recommendations were directed at the Agency. The one recommendation was directed at the Treasury Board of Canada Secretariat.

Under various acts and regulations, federal government organizations are responsible for ensuring the safety of commercially imported consumer goods that have been identified as a risk to the health and safety of Canadians. The Canada Border Services Agency (CBSA) is tasked with ensuring that commercially imported consumer goods enter Canada in conformity with applicable laws and regulations.

To achieve this, the CBSA works with other federal government organizations to implement controls at the border. Controls at the border include administration of import requirements (for example, permits and authorizations), detection and interception of shipments targeted by federal organizations as high risk or non-compliant, and examination of selected shipments for admissibility into Canada. These controls are part of a broader product safety regime that also includes both pre- and post-border controls, such as licensing and market surveillance, and is supported by importers' voluntary compliance. The regime is intended to control any high-risk products that are allowed to enter the country and thereby help ensure the safety of imported products in the marketplace.

The OAG examined the part of the product safety regime that is implemented at the border. Looking at selected commercially imported goods—including fertilizers, health products, pest control products, consumer products, consumer fireworks, vehicles, and tires—the OAG examined how the CBSA, the Canadian Food Inspection Agency, Health Canada, Natural Resources Canada, and Transport Canada work together to ensure that products comply with applicable legislation when they enter Canada.

Audit work for this chapter was substantially completed on 30 September 2011.

Agency Response: The Canadian Food Inspection Agency agreed with the one recommendation directed at the Agency and will conduct an assessment of its fertilizer referral process to the Canada Border Services Agency by Fall 2012 to determine if a formal monitoring program is required.

The full cost of the user fees' activities includes all direct and indirect expenditures. The full cost also includes services provided without charge by other government departments.

These figures are in accordance with the 2012-13 Report on Plans and Priorities and the estimated amounts of services provided without charge by other government departments.

Note: The Canadian Food Inspection Agency has begun a systematic review of its activities across all of its program areas with the objective of modernizing its user fee and service standard structure. The process from developing draft fee proposals to implementation of new fee and service standard structures can take some time as the User Fees Act (UFA) sets requirements, expectations and conditions for departments and agencies when proposing a new fee, or broadening the application or increasing the amount of an existing fee. This includes comprehensive stakeholder consultations, the striking of an independent complaints panel if required, and the tabling of proposals in both Houses of Parliament for review. This process can take an estimated 18 months. Once fee changes have been implemented, the Agency will begin more robust performance measurement and reporting on service standards, both requirements under the UFA.

Table B: External Fee

2011-2012 CFIA's Performance Report on External Fees

External Fee

Service Standard

Performance Result

Stakeholder Consultation

Fees charged for the processing of access requests filed under the Access to Information Act (ATIA)

Response provided within 30 days following receipt of request; response time may be extended pursuant to Section 9 of the ATIA. Notice of extension to be sent within 30 days of receipt of request.

Of the 329 requests completed under the ATIA last fiscal year, 115 (35%) were completed in under 30 days; 41 (13%) were completed in 31 to 60 days; 74 (22%) were completed in 61 to 120 days; and 99 (30%) were completed in 121 or over.

Not Met

The service standard is established by the ATIA and the Access to Information Regulations. Consultations with stakeholders were undertaken by the Department of Justice and the Treasury Board Secretariat for amendments done in 1986 and 1992.

To conform with the CFIA service delivery standards for veterinary biologics, the cost-recovered regulatory services must be delivered within specified service standards (time frames).

In the current fiscal year, the CFIA's Canadian Centre for Veterinary Biologics met all key service standards for veterinary biologics regulatory services.

Met

Stakeholders are consulted during semi-annual meetings of the Canadian Animal Health Products Regulatory Advisory Committee (CAHPRAC) and in bilateral meetings with the Canadian Animal Health Institute. The regulated companies and other stakeholders are satisfied with the timeliness of delivery of cost-recovered regulatory services for the veterinary biologics sector.

To address stakeholder concerns, a phased review system is in place which allows for submission review and response while information and data are pending.

2. Review supplemental data and prepare response

2) Response time 6 weeks maximum

Average response time is 4 weeks

Met

American Manufacturers

3. Review initial submission and prepare response

3) Response time 4 months maximum

Average response time is 3 months

Met

To address stakeholder concerns about timely availability of US manufactured products, a concurrent review system was introduced to allow for submission review and response while US licensure is being finalized.

4. Review supplemental data and prepare response

4) Response time 6 weeks maximum

Average response time is 4 weeks

Met

Manufacturers from other countries

5. Review initial submission and prepare response

5) Response time 6 months maximum

Average response time is 4 months

Met

6. Review supplemental data and prepare response

6) Response time 6 weeks maximum

Average response time is 4 weeks

Met

Laboratory Testing

7. Each master cell line

7) Response time 4 months maximum

No tests were conducted in 2011-12

8. Each master seed culture

8) Response time 4 months maximum

No tests were conducted in 2011-12

9. Each pre-licensing serial tested, to a maximum of three

9) Response time is maximum 4 months

No tests were conducted in 2011-12

Facility Inspections/Audits

10. Canadian manufacturers

10) Annual

Average is annual.

Met

11. Canadian importers

11) Minimum every 3 years

Average is every three years

Met

12. American manufacturers

12) Minimum every 3 years

Average is every three years

Met

For facilities which are inspected annually and licensed by the US Department of Agriculture, Animal and Plant Health Inspection Service (USDA-APHIS), CCVB may inspect when the product is first licensed in Canada. Subsequent inspections will be arranged as necessary. CCVB may request copies of inspection reports from USDA-APHIS.

13. Other non-Canadian manufacturers

13) Minimum every 4 years

Average is every four years

Met

For facilities which are inspected regularly for Good Manufacturing Practices, CCVB may inspect when the product is first licensed in Canada. Subsequent inspections will be arranged as necessary.

14. Issuance of Permits, Licenses and Export Certificates

14) Response time maximum 2 weeks

Average response time is 2 weeks.

Met

Serial Release

15. If not tested

15) Response time maximum 5 days

Average response time is 2–3 days.

Met

16. If tested

16) Response time maximum 35 days

Due to test scheduling and set up requirements, the average response time is 15 days.

Met

17. Label Review and Approval

17) Response time maximum 4 weeks

Average response time is 2 weeks.

Met

18. Advertising Review and Approval

18) Response time maximum 4 weeks

Average response time is 2 weeks.

Met

To address stakeholder concerns, CCVB is no longer reviewing and approving advertising.

To address stakeholders concerns about capacity and timeliness of the regulatory approval process, the CFIA is working through the Canadian Animal Health Products Regulatory Advisory Committee (CAHPRAC).

(d) The laboratory does a desk review of proposed method of analysis within 4 weeks of receiving it. If laboratory testing is required, it will be done within 12 weeks of receiving a suitable method and test samples depending on availability of specialized equipment.

Not Applicable

(ii) Quality

(a) The Feeds Regulations are consistently interpreted and applied in registration/approval decisions.

Met

(b) Information is openly exchanged between clients and evaluation specialists.